As filed with the U.S. Securities and Exchange Commission on March 5, 2024

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________

AMENDMENT NO. 6
TO
FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

____________________________

Vittoria Limited

(Exact name of registrant as specified in its charter)

____________________________

Unit 402B, 4/F, China Insurance Group Building,
141 Des Voeux Road Central,
Central, Hong Kong
Tel: +852 35904603

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

____________________________

c/o Cogency Global Inc.
122 East 42nd Street, 18th Floor
New York, NY 10168
+1(800) 221-0102

(Name, address, including zip code, and telephone number, including area code, of agent for service)

____________________________

Copies to:

____________________________

Approximate date of commencement of proposed sale to public: As soon as practicable after the effective date of this Registration Statement.

If any securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

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†         The term “new or revised financial accounting standards” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the U.S. Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.

VITTORIA LIMITED

1,750,000 Class A Ordinary Shares

This is an initial public offering (the “Offering”) of 1,750,000 Class A ordinary shares, par value US$0.0001 per share (the “Class A Ordinary Shares”), of Vittoria Limited (“Vittoria”, the “Company”, “we”, “our”, “us”). We are offering 1,750,000 Class A Ordinary Shares, representing approximately 29.17% of the Class A Ordinary Shares following completion of the Offering. The seven existing shareholders of the Company, Ms. Hau Sze, MO, and Mr. Shuai, GE, Dream Forge Limited, Moonlight Growth Limited, Ralph TS Group Limited, Mr. Wai Pan, CHENG and Ms. Tsz Ying, KUNG (the “Selling Shareholders”), are also offering an additional 2,000,000 Class A Ordinary Shares pursuant to the Resale Prospectus, representing approximately 33.33% of the Class A Ordinary Shares following the completion of this Offering. Following the Offering, approximately 62.5% of the Class A Ordinary Shares will be held by public shareholders, assuming the underwriters do not exercise the over-allotment option. We will not receive any of the proceeds from the sale of our Class A Ordinary Shares by the Selling Shareholders.

We anticipate that the initial public offering price (the “Offering Price”) will be between US$4.00 and US$5.00 per Class A Ordinary Share. We have applied to list our Class A Ordinary Shares on the Nasdaq Capital Market. We have reserved the symbol “VTA” for purpose of listing our Class A Ordinary Shares on the Nasdaq Capital Market. Prior to this Offering, there has been no public market for our Class A Ordinary Shares. This Offering is contingent upon the final approval of our listing application from Nasdaq Capital Market, or Nasdaq. However, there is no assurance that such application will be approved, and if our application is not approved by the Nasdaq Capital Market, this Offering cannot be completed.

Vittoria Limited’s issued share capital is a dual-class structure consisting of Class A Ordinary Shares and Class B Ordinary Shares. Holders of Class A Ordinary Shares and Class B Ordinary Shares shall vote together as one class on all resolutions of the shareholders and have the same rights except each Class A Ordinary Share shall entitle its holder to one (1) vote and each Class B Ordinary Share shall entitle its holder to fifteen (15) votes. Each Class B Ordinary Share is convertible into one (1) Class A Ordinary Share at any time at the option of the holder thereof but Class A Ordinary Shares are not convertible into Class B Ordinary Shares.

Investing in our Class A Ordinary Shares involves a high degree of risk, including the risk of losing your entire investment. See “Risk Factors” beginning on page 24 to read about factors you should consider before buying our Class A Ordinary Shares.

We are an “Emerging Growth Company” under applicable U.S. federal securities laws and are, therefore, eligible for reduced public company reporting requirements. Please read “Implications of Being an Emerging Growth Company” beginning on page 19 of this prospectus for more information.

Following this Offering, Victory Amaze Limited, our largest shareholder, will retain controlling voting power in the Company based on having approximately 84.85% of the aggregate voting power of our issued and outstanding Class A and Class B Ordinary Shares, assuming that the underwriters do not exercise their over-allotment option, and assuming that Selling Shareholders will sell all of the Class A Ordinary Shares they offered for sale (2,000,000 Class A Ordinary Shares) pursuant to the Resale Prospectus. As a result, Victory Amaze Limited has the ability to control the outcome of matters submitted to the shareholders for approval. Additionally, we may be deemed to be a “controlled company” within the meaning of the under Nasdaq Listing Rules 5615(c), and we may follow certain exemptions from certain corporate governance requirements that could adversely affect our public shareholders. See “Risk Factors — Risks Relating to Our Class A Ordinary Shares and This Offering — The dual-class structure of our ordinary shares will have the effect of concentrating voting control with our Controlling Shareholder, Victory Amaze, which will hold in the aggregate 84.85% of the voting power of our voting shares following the completion of this Offering, preventing you and other shareholders from influencing significant decisions, including the election of directors, amendments to our organizational documents and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring shareholder approval.” on page 55 and “Prospectus Summary — Implications of Being a Controlled Company.” on page 20 of this prospectus.

Investors are cautioned that you are buying shares of a British Virgin Islands (“BVI”) holding company with operations conducted in Hong Kong by its subsidiary. Vittoria is not a Chinese or Hong Kong operating company, but is a holding company incorporated in the BVI. As a holding company with no material operation, Vittoria conducts its operations in Hong Kong through its subsidiary, Red Solar Capital Limited (“Red Solar” or “Operating Subsidiary”), a company incorporated in Hong Kong. This is an offering of the Class A Ordinary

Shares of Vittoria, the holding company in BVI, instead of shares of our operating entity in Hong Kong, Red Solar. Investors in this Offering will not directly hold equity interests in the Operating Subsidiary. This structure involves unique risks to the investors, and the PRC regulatory authorities could disallow this structure, which would likely result in a material change in Vittoria’s operations and/or a material change in the value of the securities Vittoria is registering for sale, including that such event could cause the value of such securities to significantly decline or become worthless.

All of our operations are conducted by our indirect wholly-owned Operating Subsidiary in Hong Kong, which is a special administrative region of the PRC. We do not have any operation or maintain an office or personnel in Mainland China, nor currently do we have, nor intend to have, any contractual arrangements to establish a variable interest entity (“VIE”) structure with any entity in Mainland China. We are subject to certain legal and operational risks associated with our Operating Subsidiary being based in Hong Kong, having all of its operations to date in Hong Kong and having existing or potential clients who are Mainland China individuals or companies that have shareholders or directors that are Mainland China individuals. Additionally, the legal and operational risks associated with operating in Mainland China may also apply to our operations in Hong Kong, as we face the unique risks and uncertainties associated with interpretation and the application of the complex and evolving PRC laws and regulations and whether and how the recent PRC government statements and regulatory developments, such as those relating to data and cyberspace security, and anti-monopoly concerns would be applicable to Red Solar or Vittoria, given the substantial operations of our subsidiaries in Hong Kong and the possibilities that Chinese government may exercise significant oversight over the conduct of business in Hong Kong. We are also subject to the risks of uncertainty about any future actions of the PRC government or authorities in Hong Kong in this regard. Should the PRC government choose to exercise significant oversight and discretion over the conduct of our business, or in the event that we or our Hong Kong subsidiaries were to become subject to the PRC laws and regulations, these risks could result in material costs to ensure compliance, fines, material changes in our operations and/or the value of the securities we are registering for sale, and/or could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless. See “Risk Factors — Risks Relating to Doing Business in the Jurisdictions in which We Operate — All of our operations are in Hong Kong. However, due to the long-arm application of the current PRC laws and regulations, the PRC government may exercise significant direct oversight and discretion over the conduct of our business and may intervene or influence our operations, which could result in a material change in our operations and/or the value of our Class A Ordinary Shares. Our subsidiaries in Hong Kong may be subject to laws and regulations of Mainland China, which may impair our ability to operate profitably and result in a material negative impact on our operations and/or the value of our Class A Ordinary Shares. Furthermore, the changes in the policies, laws, regulations, rules, and the enforcement of laws of Mainland China may also occur quickly with little advance notice and our assertions and beliefs of the risk imposed by the Mainland China legal and regulatory system cannot be certain” on page 24; and “Risk Factors — Risks Relating to Doing Business in the Jurisdictions in which We operate — If the PRC government chooses to extend the oversight and control over offerings that are conducted overseas and/or foreign investment in Mainland China-based issuers to Hong Kong-based issuers, such action may significantly limit or completely hinder our ability to offer or continue to offer Class A Ordinary Shares to investors and cause the value of our Class A Ordinary Shares to significantly decline or be worthless” on page 30.

We are aware that recently, the PRC government initiated a series of regulatory actions and statements to regulate business operations in certain areas in Mainland China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using a variable interest entity structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. See “Prospectus Summary — Regulatory Development in the PRC” beginning on page 15. On August 20, 2021, the 30th meeting of the Standing Committee of the 13th National People’s Congress voted and passed the “Personal Information Protection Law of the People’s Republic of China”, or “PRC Personal Information Protection Law”, which became effective on November 1, 2021. The PRC Personal Information Protection Law applies to the processing of personal information of natural persons within the territory of Mainland China that is carried out outside of Mainland China where (i) such processing is for the purpose of providing products or services for natural persons within Mainland China, (ii) such processing is to analyze or evaluate the behavior of natural persons within Mainland China, or (iii) there are any other circumstances stipulated by related laws and administrative regulations. On December 24, 2021, the China Securities Regulatory Commission (“CSRC”), together with other relevant government authorities in Mainland China issued the Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) and the Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (“Draft Overseas Listing Regulations”). The Draft Overseas Listing Regulations require that a

Mainland China domestic enterprise seeking to issue and list its shares overseas (“Overseas Issuance and Listing”) shall complete the filing procedures of and submit the relevant information to the CSRC. The Overseas Issuance and Listing include direct and indirect issuance and listing. Where an enterprise whose principal business activities are conducted in Mainland China seeks to issue and list its shares in the name of an overseas enterprise (“Overseas Issuer”) on the basis of the equity, assets, income or other similar rights and interests of the relevant Mainland China domestic enterprise, such activities shall be deemed an indirect overseas issuance and listing (“Indirect Overseas Issuance and Listing”) under the Draft Overseas Listing Regulations. On December 28, 2021, the Cyberspace Administration of China (the “CAC”) jointly with the relevant authorities formally published the Measures for Cybersecurity Review (2021) which took effect on February 15, 2022 and replaced the former Measures for Cybersecurity Review (2020) issued on July 10, 2021. The Measures for Cybersecurity Review (2021) provide that operators of critical information infrastructure purchasing network products and services, and online platform operators carrying out data processing activities that affect or may affect national security (together with the operators of critical information infrastructure, the “Operators”), shall conduct a cybersecurity review and that any online platform operator who controls more than one million users’ personal information must go through a cybersecurity review by the cybersecurity review office if it seeks to be listed in a foreign country. On February 17, 2023, 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. The Trial Administrative Measures further stipulate the rules and requirements for overseas offering and listing conducted by PRC domestic companies. The Trial Administrative Measures further clarified and emphasized that the comprehensive determination of the “indirect overseas offering and listing by PRC domestic companies” shall comply with the principle of “substance over form” and particularly, an issuer will be required to go through the filing procedures under the Trial Administrative Measures if the following criteria are met at the same time: a) 50% or more of the issuer’s operating revenue, total profits, total assets or net assets as documented in its audited consolidated financial statements for the most recent accounting year are accounted for by PRC domestic companies, and b) the main parts of the issuer’s business activities are conducted in Mainland China, or its main places of business are located in Mainland China, or the senior managers in charge of its business operation and management are mostly Chinese citizens or domiciled in Mainland China. Furthermore, the Trial Administrative Measures and its supporting guidelines provide a negative list of types of issuers banned from listing overseas, the issuers’ obligation to comply with national security measures and the personal data protection laws, and certain other matters such as the requirements that an issuer (i) file with the CSRC within three business days after it submits an application for initial public offering to the competent overseas regulator and (ii) file subsequent reports with the CSRC on material events, including change of control and voluntary or forced delisting, after its overseas offering and listing.

As advised by our PRC Counsel, China Commercial Law Firm, as of the date of this prospectus, based on PRC laws and regulations effective as of the date of this prospectus and subject to interpretations of these laws and regulations that may be adopted by Mainland China authorities, neither we, nor our Operating Subsidiary are covered by the permission requirement from any PRC authorities, including CAC and CSRC, neither we, nor our Operating Subsidiary are required to obtain any permission or approval from any PRC authorities, including the CSRC and CAC, to operate our business and offer the securities being registered to foreign investors, and the Measures for Cybersecurity Review (2021), the PRC Personal Information Protection Law, the Draft Overseas Listing Regulations, and the Trial Administrative Measures will not have an impact on our business, operations or this offering, on the basis that: (i) we do not, directly or indirectly, own or control any entity or subsidiary in Mainland China, nor is it controlled by any Mainland Chinese company or individual directly or indirectly; (ii) we and our subsidiaries do not have any operations in Mainland China; (iii) we do not have or intend to set up any subsidiary or enter into any contractual arrangements to establish a variable interest entity structure with any entity in Mainland China; (iv) we are headquartered in Hong Kong with our officers and all members of the board of directors based in Hong Kong who are not Mainland China citizens and all of our revenues and profits are generated by our subsidiary in Hong Kong and we have not generated revenues or profits from Mainland China in the most recent accounting year accounts for more than 50% of the corresponding figure in ours audited consolidated financial statements for the same period; (v) although our Hong Kong Operating Subsidiary may collect and store certain data (including certain personal information) from our clients, some of whom may be individuals in Mainland China, in connection with our business and operations for “Know Your Customers” purposes (to combat money laundering), we and our Operating Subsidiary will not be deemed to be an “Operator” or a “data processor” that are required to file for cybersecurity review by the CAC before listing in the United States, given that: (a) as of date of this prospectus, our Operating Subsidiary has in aggregate collected and stored the personal information of less than one thousand individuals in Mainland China and we have acquired the clients’ separate consents for collecting and storing of their personal information and data; (b) we do not place any reliance on collection and processing of any personal information to maintain our business operation; (c) data processed in our business should not have a bearing on national security nor affect or may affect national security; (d) all of the data our Operating Subsidiary have collected is stored in servers located in Hong Kong; and (e) as of the date of this

prospectus, neither of our Operating Subsidiary has been informed by any PRC governmental authority of being classified as an “Operator” or a “data processor” that is subject to CAC cybersecurity review or a CSRC review; and (vi) pursuant to the Basic Law of the Hong Kong Special Administrative Region of the PRC, or the Basic Law, PRC laws and regulations shall not be applied in Hong Kong except for those listed in Annex III of the Basic Law (which is confined to laws relating to national defense, foreign affairs and other matters that are not within the scope of autonomy).

However, as further advised by our PRC Counsel, China Commercial Law Firm, given the uncertainties arising from the legal system in Mainland China and Hong Kong, including uncertainties regarding the interpretation and enforcement of PRC laws and the significant authority of the PRC government to intervene or influence the offshore holding company headquartered in Hong Kong, there remains significant uncertainty in the interpretation and enforcement of relevant Mainland China laws and other regulations. Since these laws, regulations and regulatory actions are new, it is highly uncertain how soon the legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any. It is also highly uncertain what the potential impact such modified or new laws and regulations will have on our Operating Subsidiary’s daily business operation and the listing of our Class A Ordinary Shares on the United States or other foreign exchanges. As the Trial Administrative Measures was newly promulgated, its interpretation, application and enforcement remain unclear and there also remains significant uncertainty as to the enactment, interpretation and implementation of other regulatory requirements related to overseas securities offerings and other capital markets activities. If Trial Administrative Measures become applicable to us or our Operating Subsidiary in Hong Kong, or if we or our Operating Subsidiary is subject to cybersecurity review, or if the Measures for Cybersecurity Review (2021) or the PRC Personal Information Protection Law become applicable to our Operating Subsidiary in Hong Kong, the business operation of our Operating Subsidiary and the listing of our Class A Ordinary Shares in the United States could be subject to the CAC or the CSRC review in the future. If the applicable laws, regulations, or interpretations change and our Operating Subsidiary become subject to the CAC or CSRC review, we cannot assure you that our Operating Subsidiary will be able to comply with the regulatory requirements in all respects and our current practice of collecting and processing personal information may be ordered to be rectified or terminated by regulatory authorities. If we were required to obtain such permissions or approvals in the future in connection with the listing or continued listing of our securities on a stock exchange outside of the PRC, it is uncertain how long it will take for us to obtain such approval, and, even if we obtain such approval, the approval could be rescinded. Any failure to obtain or a delay in obtaining the necessary permissions from the PRC authorities to conduct offerings or list outside of the PRC may subject us to sanctions imposed by the PRC regulatory authorities, which could include fines and penalties, proceedings against us, and other forms of sanctions, and our ability to conduct our business, invest into the Mainland China as foreign investments or accept foreign investments, ability to offer or continue to offer Class A Ordinary Shares to investors or list on the U.S. or other overseas exchange may be restricted, and the value of our Class A Ordinary Shares may significantly decline or be worthless, our business, reputation, financial condition, and results of operations may be materially and adversely affected. See “Risk Factors — Risks Relating to Doing Business in the Jurisdictions in which we Operate — If the PRC government chooses to extend the oversight and control over offerings that are conducted overseas and/or foreign investment in Mainland China-based issuers to Hong Kong-based issuers, such action may significantly limit or completely hinder our ability to offer or continue to offer Class A Ordinary Shares to investors and cause the value of our Class A Ordinary Shares to significantly decline or be worthless.” on page 30.

Our Class A Ordinary Shares may be prohibited from trading on a national exchange or “over-the-counter” markets under the Holding Foreign Companies Accountable Act (the “HFCAA”) if the Public Company Accounting Oversight Board (“PCAOB”) determines that it is unable to inspect or fully investigate our auditor and as a result the exchange where our securities are traded may delist our securities. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the “AHFCAA”), which was signed into law on December 29, 2022, amending the HFCAA and requiring the Securities and Exchange Commission (“SEC”) to prohibit an issuer’s securities from trading on any U.S. stock exchange if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years. Pursuant to the HFCAA, the PCAOB issued a Determination Report on December 16, 2021, which found that the PCAOB was unable to inspect or investigate completely certain named registered public accounting firms headquartered in Mainland China and Hong Kong.

Our auditor, WWC, P.C., the independent registered public accounting firm that issues the audit report included elsewhere in this prospectus, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is headquartered in California and subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards. Our auditor is currently subject to PCAOB inspections and the PCAOB is able to inspect our

auditor, with the last inspection having occurred in November 2021. Our auditor is not affected by and not subject to the determinations announced by the PCAOB on December 16, 2021. On August 26, 2022, the SEC issued a statement announcing that the PCAOB signed a Statement of Protocol (“SOP”) with the CSRC and the Ministry of Finance of the PRC governing inspections and investigations of audit firms based in China and Hong Kong, jointly agreeing on the need for a framework. On December 15, 2022, the PCAOB announced that it has secured complete access to inspect and investigate registered public accounting firms headquartered in Mainland China and Hong Kong and voted to vacate the previous 2021 Determination Report to the contrary.

However, whether the PCAOB will continue to be able to satisfactorily conduct inspections of PCAOB-registered public accounting firms headquartered in Mainland China and Hong Kong is subject to uncertainty and depends on a number of factors out of our, and our auditor’s, control. The PCAOB is continuing to demand complete access in Mainland China and Hong Kong moving forward and is already making plans to resume regular inspections in early 2023 and beyond, as well as to continue pursuing ongoing investigations and initiate new investigations as needed. The PCAOB has indicated that it will act immediately to consider the need to issue new determinations with the HFCAA if needed. If the PCAOB in the future again determines that it is unable to inspect and investigate completely auditors in Mainland China and Hong Kong, then the companies audited by those auditors would be subject to a trading prohibition on U.S. markets pursuant to the HFCAA and/or AHFCAA. These recent developments could also add uncertainties to this Offering and we cannot assure you that the NASDAQ Capital Market or regulatory authorities would not apply additional or more stringent criteria to us after considering the effectiveness of our auditor’s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach or experience as it relates to the audit of our financial statements. See “Risk Factors — Risks Relating to Our Class A Ordinary Shares and This Offering — Our Class A Ordinary Shares may be prohibited from being traded on a national exchange under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect our auditors. The delisting of our Class A Ordinary Shares, or the threat of their being delisted, may materially and adversely affect the value of your investment. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, which was signed into law on December 29, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three.” on page 50.

Vittoria relies on dividends or payments to be paid by its Hong Kong subsidiaries (i.e. Exceller and Red Solar), to fund its cash and financing requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders and U.S. investors, to service any debt we may incur and to pay our operating expenses. Vittoria is permitted under the laws of BVI to provide funding to its subsidiaries in Hong Kong (i.e., Exceller and Red Solar) through loans or capital contributions without restrictions on the amount of the funds. Exceller and Red Solar are also permitted under the laws of Hong Kong to provide funding to Vittoria, through dividend distributions or payments, without restrictions on the amount of the funds. There are no restrictions or limitation on our ability to distribute earnings by dividends from our subsidiaries, to Vittoria and our shareholders and U.S. investors, provided that the entity remains solvent after such distribution. Subject to the BVI Act and our Amended and Restated Memorandum and Articles of Association, our board of directors may, by resolution of directors, authorize and declare a dividend to shareholders at such time and of such an amount as they deem fit if they are satisfied, on reasonable grounds, that immediately following the dividend the value of our assets will exceed our liabilities and Vittoria will be able to pay our debts as they become due. According to the Companies Ordinance of Hong Kong (Chapter 622 of the Laws of Hong Kong), a Hong Kong company may only make a distribution out of profits available for distribution. Other than the above, we did not adopt or maintain any cash management policies and procedures as of the date of this prospectus. There is no further BVI or Hong Kong statutory restriction on the amount of funds which may be distributed by us by dividend. Under the current practice of the Inland Revenue Department of Hong Kong, no withholding tax is payable in Hong Kong in respect of dividends paid by our Hong Kong subsidiaries to us.

Vittoria is a BVI company, and Exceller and Red Solar are both Hong Kong companies. There are no restrictions on foreign exchange and there are no limitations on the abilities of Vittoria to transfer cash to or from Exceller and Red Solar, or to investors under Hong Kong law. There are no restrictions or limitations under the laws of Hong Kong imposed on the conversion of HK dollar into foreign currencies and the remittance of currencies out of Hong Kong, nor there is any restriction on foreign exchange to transfer cash between Vittoria and its subsidiaries, across borders and to U.S investors, nor there is any restrictions and limitations to distribute earnings from our business and subsidiaries, to Vittoria and U.S. investors and amounts owed. Since the only transfer of cash among and Exceller and Red Solar

TABLE OF CONTENTS

We and the Selling Shareholders have not, and the Underwriters have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses prepared by us or on our behalf or to which we have referred you. If anyone provides you with different or inconsistent information, you should not rely on it. We and the Selling Shareholders are not, and the Underwriters are not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted or where the person making the offer or sale is not qualified to do so or to any person to whom it is not permitted to make such offer or sale. For the avoidance of doubt, no offer or invitation to subscribe for Class A Ordinary Shares is made to the public in the British Virgin Islands. You should not rely upon any information about us that is not contained in this prospectus or in one of our public reports filed with the Securities and Exchange Commission (“SEC”) and incorporated into this prospectus. The information in this registration statement is not complete and is subject to change. No person should rely on the information contained in this document for any purpose other than participating in our proposed Offering, and only the prospectus dated hereof, is authorized by us to be used in connection with our proposed Offering. Our business, financial condition, results of operations, and prospects may have changed since that date.

Neither we, the Selling Shareholders, nor the Underwriters have taken any action to permit a public offering of the Class A Ordinary Shares outside the United States or to permit the possession or distribution of this prospectus or any filed free-writing prospectus outside the United States. Persons outside the United States who come into possession of this prospectus or any filed free writing prospectus must inform themselves about and observe any restrictions relating to the Offering of the Class A Ordinary Shares and the distribution of this prospectus or any filed free-writing prospectus outside the United States.

Vittoria is incorporated under the laws of the BVI as a BVI business company with limited liability and a majority of our outstanding securities are owned by non-U.S. residents. Under the rules of the U.S. Securities and Exchange Commission, or the SEC, we currently qualify for treatment as a “foreign private issuer.” As a foreign private issuer, we will not be required to file periodic reports and financial statements with the Securities and Exchange Commission, or the SEC, as frequently or as promptly as domestic registrants whose securities are registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act.

Through and including ________, 2023 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this Offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

RISK FACTORS

An investment in our Class A Ordinary Shares involves a high degree of risk. Before deciding whether to invest in our Class A Ordinary Shares, you should consider carefully the risks described below, together with all of the other information set forth in this prospectus, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and our consolidated financial statements and related notes. If any of these risks actually occurs, our business, financial condition, results of operations or cash flow could be materially and adversely affected, which could cause the trading price of our Class A Ordinary Shares to decline, resulting in a loss of all or part of your investment.

Risks Relating to Doing Business in the Jurisdictions in which we Operate

All of our operations are in Hong Kong. However, due to the long-arm application of the current PRC laws and regulations, the PRC government may exercise significant direct oversight and discretion over the conduct of our business and may intervene or influence our operations, which could result in a material change in our operations and/or the value of our Class A Ordinary Shares. Our subsidiaries in Hong Kong may be subject to laws and regulations of Mainland China, which may impair our ability to operate profitably and result in a material negative impact on our operations and/or the value of our Class A Ordinary Shares. Furthermore, the changes in the policies, laws, regulations, rules, and the enforcement of laws of Mainland China may also occur quickly with little advance notice and our assertions and beliefs of the risk imposed by the Mainland China legal and regulatory system cannot be certain.

Our Operating Subsidiary is located and operate their business in Hong Kong, a special administrative region of the PRC. Although some of our clients are corporates from Mainland China or corporates that have shareholders and directors that are individuals from Mainland China, our Operating Subsidiary does not have operations in Mainland China or is not regulated by any regulator in Mainland China. Furthermore, pursuant to the Basic Law of the Hong Kong Special Administrative Region of the People’s Republic of China (“Basic Law”), national laws of Mainland China do not apply in Hong Kong unless they are listed in Annex III of the Basic Law and applied locally by promulgation or local legislation. National laws that may be listed in Annex III are currently limited under the Basic Law to those which fall within the scope of defense and foreign affairs as well as other matters outside the limits of the autonomy of Hong Kong. National laws and regulations relating to data protection, cybersecurity and the anti-monopoly have not been listed in Annex III and so do not apply directly to Hong Kong.

However, due to long-arm provisions under the current PRC laws and regulations, there remains regulatory and legal uncertainty with respect to the implementation of laws and regulations of Mainland China to Hong Kong. As a result, there is no guarantee that the PRC government may not choose to implement the laws of Mainland China to Hong Kong and exercise significant direct influence and discretion over the operation of our Operating Subsidiary in the future and, it will not have a material adverse impact on our business, financial condition and results of operations, due to changes in laws, political arrangement, or other unforeseeable reasons.

In the event that we or our Hong Kong Operating Subsidiary were to become subject to the laws and regulations of Mainland China, the legal and operational risks associated in Mainland China may also apply to our operations in Hong Kong, and we face the risks and uncertainties associated with the legal system in the Mainland China, complex and evolving PRC laws and regulation, and as to whether and how the recent PRC government statements and regulatory developments, such as those relating to data and cyberspace security and anti-monopoly concerns, would be applicable to companies like our Operating Subsidiary and us, given the substantial operations of our Operating Subsidiary in Hong Kong and the Chinese government may exercise significant oversight over the conduct of business in Hong Kong.

The laws and regulations in Mainland China are evolving, and their enactment timetable, interpretation, enforcement, and implementation involve significant uncertainties and can change quickly with little advance notice, along with the risk that the PRC government may intervene or influence our Operating Subsidiary’s operations at any time could result in a material change in our operations and/or the value of our securities. Moreover, there are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including, but not limited to, the laws and regulations related to our business and the enforcement and performance of our arrangements with clients in certain circumstances. The laws and regulations are sometimes vague and may be subject to future changes, and their official interpretation and enforcement may involve substantial uncertainty. The effectiveness and interpretation of newly

enacted laws or regulations, including amendments to existing laws and regulations, may be delayed, and our business may be affected if we rely on laws and regulations which are subsequently adopted or interpreted in a manner different from our understanding of these laws and regulations. New laws and regulations that affect existing and proposed future businesses may also be applied retroactively. We cannot predict what effect the interpretation of existing or new PRC laws or regulations may have on our business.

The laws, regulations, and other government directives in Mainland China may also be costly to comply with, and such compliance or any associated inquiries or investigations or any other government actions may:

•        delay or impede our development;

•        result in negative publicity or increase our operating costs;

•        require significant management time and attention;

•        cause devaluation of our securities or delisting; and,

•        subject us to remedies, administrative penalties and even criminal liabilities that may harm our business, including fines assessed for our current or historical operations, or demands or orders that we modify or even cease our business operations.

We are aware that recently, the PRC government initiated a series of regulatory actions and statements to regulate business operations in certain areas in Mainland China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over Mainland China-based companies listed overseas using a variable interest entity structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. We have no operations in Mainland China. Our Operating Subsidiary is located, and operates, in Hong Kong, a special administrative region of the PRC. Based on our understanding of the PRC laws and regulations currently in effect as of the date of this prospectus, as our Operating Subsidiary is located in Hong Kong, we are not currently required to obtain permission from the PRC government to list on a U.S. securities exchange and consummate this Offering. However, there is no guarantee that this will continue to be the case in the future in relation to the continued listing of our securities on a securities exchange outside of the PRC, or even when such permission is obtained, it will not be subsequently denied or rescinded.

The PRC government may intervene or influence our operations at any time or may exert control over offerings conducted overseas and foreign investment in Hong Kong-based issuers, which may result in a material change in our operations and/or the value of our Class A Ordinary Shares. For example, there is currently no restriction or limitation under the laws of Hong Kong on the conversion of HK dollar into foreign currencies and the transfer of currencies out of Hong Kong and the laws and regulations of the PRC on currency conversion control do not currently have any material impact on the transfer of cash between the ultimate holding company and the Operating Subsidiary in Hong Kong. However, the Chinese government may, in the future, impose restrictions or limitations on our ability to move money out of Hong Kong to distribute earnings and pay dividends to and from the other entities within our organization or to reinvest in our business outside of Hong Kong. Such restrictions and limitations, if imposed in the future, may delay or hinder the expansion of our business to outside of Hong Kong and may affect our ability to receive funds from our Operating Subsidiary in Hong Kong. The promulgation of new laws or regulations, or the new interpretation of existing laws and regulations, in each case, that restrict or otherwise unfavorably impact the ability or way we conduct our business, could require us to change certain aspects of our business to ensure compliance, which could decrease demand for our services, reduce revenues, increase costs, require us to obtain more licenses, permits, approvals or certificates, or subject us to additional liabilities. To the extent any new or more stringent measures are required to be implemented, our business, financial condition and results of operations could be adversely affected and such measured could materially decrease the value of our Class A Ordinary Shares, potentially rendering it worthless.

There remain some uncertainties as to whether we will be required to obtain approvals from the PRC authorities to list on the U.S. exchanges and offer securities in the future, and if required, we cannot assure you that we will be able to obtain such approval. We may become subject to a variety of PRC laws and other obligations regarding data security in relation to offerings that are conducted overseas, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, financial condition and results of operations and may hinder our ability to offer or continue to offer Class A Ordinary Shares to investors and cause the value of our Class A Ordinary Shares to significantly decline or be worthless.

On June 10, 2021, the Standing Committee of the National People’s Congress enacted the PRC Data Security Law, which took effect on September 1, 2021. The law requires data collection to be conducted in a legitimate and proper manner, and stipulates that, for the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection system for data security.

On July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly issued a document to crack down on illegal activities in the securities market and promote the high-quality development of the capital market, which, among other things, requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and judicial cooperation, to enhance supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial application of the PRC securities laws.

On August 20, 2021, the 30th meeting of the Standing Committee of the 13th National People’s Congress voted and passed the “Personal Information Protection Law of the People’s Republic of China”, or “PRC Personal Information Protection Law,” or the “PIPL,” which became effective on November 1, 2021. The PRC Personal Information Protection Law applies to the processing of personal information of natural persons within the territory of China that is carried out outside of China where (i) such processing is for the purpose of providing products or services for natural persons within China, (ii) such processing is to analyze or evaluate the behavior of natural persons within China, or (iii) there are any other circumstances stipulated by related laws and administrative regulations. Pursuant to the PIPL, personal data processors (“data processors”) shall meet one of the conditions in order to transmit personal information overseas for their business operations: (i) passing the security evaluation organized by the Cyberspace Administration of China (the “CAC”); (ii) acquiring personal information protection certification from the professional organizations regulated by the CAC; (iii) adopting the standard contract forms stipulated by the CAC when entering into contracts with overseas information receivers, setting forth the rights and obligations of the parties; and (iv) other conditions regulated by laws, regulations and the CAC. Prior to the cross-border provision of personal information of the natural persons, personal information processors shall obtain the approval of the corresponding natural persons and advise them of the overseas receiver’s name, contact information, processing purpose and methods, classification of personal information and information reception procedures, etc.

On December 28, 2021, the CAC jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021) which took effect on February 15, 2022 and replace the former Measures for Cybersecurity Review (2020) issued on July 10, 2021. Measures for Cybersecurity Review (2021) stipulates that in addition to “operator of critical information infrastructure,” any “data processor” carrying out data processing activities that affect or may affect national security should also be subject to cybersecurity review, and further elaborated the factors to be considered when assessing the national security risks of the relevant activities, including, among others, (i) the risk of core data, important data or a large amount of personal information being stolen, leaked, destroyed, and illegally used or transferred outside the country; and (ii) the risk of critical information infrastructure, core data, important data or a large amount of personal information being affected, controlled, or maliciously used by foreign governments after listing abroad. CAC has said that under the proposed rules companies holding data on more than one million users must apply for cybersecurity approval when seeking listings in other nations because of the risk that such data and personal information could be “affected, controlled, and maliciously exploited by foreign governments.” The cybersecurity review will also investigate the potential national security risks from overseas IPOs.

On December 24, 2021, the China Securities Regulatory Commission (“CSRC”), together with other relevant government authorities in Mainland China issued the Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments), and the Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (“Draft Overseas Listing Regulations”). The Draft Overseas Listing Regulations requires that a PRC domestic enterprise seeking to issue and list its shares overseas (“Overseas Issuance and Listing”) shall complete the filing procedures of and submit

the relevant information to CSRC. The Overseas Issuance and Listing includes direct and indirect issuance and listing. Where an enterprise whose principal business activities are conducted in PRC seeks to issue and list its shares in the name of an overseas enterprise (“Overseas Issuer”) on the basis of the equity, assets, income or other similar rights and interests of the relevant PRC domestic enterprise, such activities shall be deemed an indirect overseas issuance and listing (“Indirect Overseas Issuance and Listing”) under the Draft Overseas Listing Regulations.

On February 17, 2023, the CSRC promulgated the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (the “Trial Administrative Measures”), which came into effect on March 31, 2023. Compared to the Draft Overseas Listing Regulations, the Trial Administrative Measures further clarified and emphasized that the comprehensive determination of the “indirect overseas offering and listing by PRC domestic companies” shall comply with the principle of “substance over form” and particularly, an issuer will be required to go through the filing procedures under the Trial Administrative Measures if the following criteria are met at the same time: a) 50% or more of the issuer’s operating revenue, total profits, total assets or net assets as documented in its audited consolidated financial statements for the most recent accounting year are accounted for by PRC domestic companies, and b) the main parts of the issuer’s business activities are conducted in Mainland China, or its main places of business are located in Mainland China, or the senior managers in charge of its business operation and management are mostly Chinese citizens or domiciled in Mainland China. On the same day, 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, provided the exemption from immediate filings for issuers that a) have been listed or have been registered but not yet listed in foreign securities markets, including U.S. markets, prior to the effective date of the Trial Administrative Measures, b) are not required to re-perform the regulatory procedures with the relevant overseas regulatory authority or the overseas stock exchange, and c) will complete the overseas securities offering and listing before September 30, 2023. Nonetheless, such issuers shall carry out the filing procedures as required if they subsequently conduct refinancing or are involved in other circumstances that require filings with the CSRC. Furthermore, the Trial Administrative Measures and its supporting guidelines provide a negative list of types of issuers banned from listing overseas, the issuers’ obligation to comply with national security measures and the personal data protection laws, and certain other matters such as the requirements that an issuer (i) file with the CSRC within three business days after it submits an application for initial public offering to the competent overseas regulator and (ii) file subsequent reports with the CSRC on material events, including change of control and voluntary or forced delisting, after its overseas offering and listing.

Although our Hong Kong Operating Subsidiary may collect and store certain data (including certain personal information) from our clients, some of whom may be individuals in Mainland China, in connection with our business and operations for “Know Your Customers” purposes (to combat money laundering), as advised by our PRC Counsel, China Commercial Law Firm, we and our Operating Subsidiary will not be deemed to be an “operator of critical information infrastructure,” any “data processor” carrying out data processing activities, and we are not subject to cybersecurity review by the CAC for this Offering or required to obtain regulatory approval from the CAC nor any other PRC authorities for our and our subsidiaries’ operations Hong Kong, since (i) our Operating Subsidiary is incorporated and operating in Hong Kong only without any subsidiary or variable interest entity structure in Mainland China, and it is unclear whether the Measures for Cybersecurity Review (2021) shall be applied to a Hong Kong company; (ii) as of date of this prospectus, our Operating Subsidiary has in aggregate collected and stored the personal information of less than one thousand individuals in Mainland China only and we have acquired the clients’ separate consents for collecting and storing of their personal information and data; (iii) we do not place any reliance on collection and processing of any personal information to maintain our business operation; (iv) data processed in our business should not have a bearing on national security nor affect or may affect national security; (v) all of the data our Operating Subsidiary have collected is stored in servers located in Hong Kong; and (vi) as of the date of this prospectus, neither we or our Operating Subsidiary has been informed by any PRC governmental authority of being classified as “operator of critical information infrastructure” or “data processor” that is subject to CAC cybersecurity review or a CSRC review.

Furthermore, based on laws and regulations currently in effect in the PRC as of the date of this prospectus, as confirmed and advised by our PRC Counsel, China Commercial Law Firm, based on PRC laws and regulations effective as of the date of this prospectus, we are not required to obtain regulatory approval from the CSRC or go through the filing procedures under the Trial Administrative Measures before our Class A Ordinary Shares can be listed or offered in the U.S, although we have existing and potential clients who are Mainland China individuals or companies that have shareholders or directors that are Mainland China individuals, since neither we, nor our subsidiaries, are “PRC domestic companies” which subject to the Trial Administrative Measure, because (i) we are headquartered in Hong Kong, with our officers and all members of the board of directors based in Hong Kong who are not Mainland China

citizens; (ii) we do not, directly or indirectly, own or control any entity or subsidiary in Mainland China, nor is it controlled by any Mainland Chinese company or individual directly or indirectly; (iii) we only operate in Hong Kong, all of our revenues and profits are generated by our subsidiaries in Hong Kong, none of our business activities are conducted in Mainland China, and we have not generated revenues or profits from Mainland China in the most recent accounting year accounts for more than 50% of the corresponding figure in our audited consolidated financial statements for the same period; (iv) we do not have or intend to set up any subsidiary or enter into any contractual arrangements to establish a variable interest entity structure with any entity in Mainland China; (v) pursuant to the Basic Law of the Hong Kong Special Administrative Region of the PRC, or the Basic Law, PRC laws and regulations shall not be applied in Hong Kong except for those listed in Annex III of the Basic Law (which is confined to laws relating to national defense, foreign affairs and other matters that are not within the scope of autonomy).

However, as further advised by our PRC Counsel, China Commercial Law Firm, given the uncertainties arising from the legal system in Mainland China and Hong Kong, including uncertainties regarding the interpretation and enforcement of the PRC laws and regulations and the significant authority of the PRC government to intervene or influence the offshore holding company headquartered in Hong Kong, there remains significant uncertainty in the interpretation and enforcement of the Trial Administrative Measures, PIPL, relevant Mainland China data privacy, cybersecurity laws and other regulations. It is highly uncertain how soon the legislative or administrative regulation-making bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any. It is also highly uncertain what the potential impact such modified or new laws and regulations will have on the daily business operations of our Operating Subsidiary and the listing of our Class A Ordinary Shares on the U.S. or other foreign exchanges. As the Trial Administrative Measures are newly issued, there remains uncertainty as to how it will be interpreted or implemented. Therefore, we cannot assure you that when and whether we will be subject to such filing requirements, or will be able to get clearance from the CSRC in a timely manner, or at all, even though we believe that none of the situations that would clearly prohibit overseas listing and offering applies to us.

Although we are currently not required to obtain approvals from the PRC authorities to operate our business or list on the U.S. exchanges and offer securities; specifically, we are currently not required to obtain any permission or approval from the CSRC, the CAC or any other PRC governmental authority to operate our business or to list our securities on a U.S. securities exchange or issue securities to foreign investors. We cannot assure you that PRC regulatory agencies, including the CAC, would take the same view as we do, and there is no assurance that we can fully or timely comply with such laws. However, there remains uncertainty as to how the Measures for Cybersecurity Review (2021) will be interpreted or implemented and the relevant PRC governmental authority may not take a view that is consistent with our PRC counsel. Also, significant uncertainty exists in relation to the interpretation and enforcement of relevant PRC cybersecurity laws and regulations. If we were deemed to be an “operator of critical information infrastructure” or a “data processor” controlling personal information of no less than one million users under the Measures, or if other regulations promulgated in relation to the Measures are deemed to apply to us, our business operations and the listing of our Class A Ordinary Shares in the U.S. could be subject to cybersecurity review by the CAC, in the future. In the event that we are subject to any mandatory cybersecurity review and other specific actions required by the CAC, we face uncertainty as to whether any clearance or other required actions can be completed in a timely fashion or at all. Given such uncertainty, we may be further required to suspend our relevant business, shut down our website, or face other penalties which could materially and adversely affect our business, financial condition, and results of operations.

Furthermore, if the Trial Administrative Measures, Measures for Cybersecurity Review (2021), the PIPL, become applicable to us or our Operating Subsidiary in Hong Kong, our operation and the listing of our Class A Ordinary Shares in the United States could be subject to the CAC’s cybersecurity review or the CSRC Overseas Issuance and Listing review in the future. If the applicable laws, regulations, or interpretations change and our Operating Subsidiary become subject to the CAC or CSRC review, we cannot assure you that our Operating Subsidiary will be able to comply with the regulatory requirements in all respects and our current practice of collecting and processing personal information may be ordered to be rectified or terminated by regulatory authorities. Compliance with these laws and regulations could significantly increase the cost to us of providing our service offerings, require significant changes to our operations or even prevent us from providing certain service offerings in jurisdictions in which we currently operate or in which we may operate in the future. If there is a significant change to the current political arrangements between Mainland China and Hong Kong, or the applicable laws, regulations, or interpretations change, and/or if we were required to obtain such permissions or approvals in the future in connection with the listing or continued listing of our securities on a stock exchange outside of the PRC, it is uncertain how long it will take for us to obtain such approval, and, even if we obtain such approval, the approval could be rescinded. Any failure to obtain or a delay in obtaining the necessary permissions from the PRC authorities to conduct offerings or list outside of the

PRC may subject us to sanctions imposed by the CSRC, CAC, or other PRC regulatory authorities. It could include fines and penalties, proceedings against us, and other forms of sanctions, and our ability to conduct our business, invest into the Mainland China as foreign investments or accept foreign investments, ability to offer or continue to offer Class A Ordinary Shares to investors or list on the U.S. or other overseas exchange may be restricted, and the value of our Class A Ordinary Shares may significantly decline or be worthless, our business, reputation, financial condition, and results of operations may be materially and adversely affected. The CSRC, the CAC, or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt this offering before settlement and delivery of our Class A Ordinary Shares. In addition, if the CSRC, the CAC, or other regulatory PRC agencies later promulgate new rules requiring that we obtain their approvals for this offering, 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.

Compliance with Hong Kong’s Personal Data (Privacy) Ordinance and any such other existing or future data privacy related laws, regulations and governmental orders may entail significant expenses and could materially affect our business.

Although we are not subject to cybersecurity review by the CAC nor any other PRC authorities for this Offering or required to obtain regulatory approval regarding the data privacy and personal information requirements from the CAC nor any other PRC authorities for our and our subsidiaries’ operations Hong Kong, because all of our operations take place in Hong Kong, we are subject to a variety of laws and other obligations regarding data privacy and protection in Hong Kong.

In particular, the Personal Data (Privacy) Ordinance (Chapter 486 of the laws of Hong Kong) (the “PDPO” or the “Personal Data (Privacy) Ordinance”) imposes a duty on any data user who, either alone or jointly with other persons, controls the collection, holding, processing or use of any personal data which relates directly or indirectly to a living individual and can be used to identify that individual. Under the PDPO, data users shall take all practicable steps to protect the personal data they hold from any unauthorized or accidental access, processing, erasure, loss, or use. Once collected, such personal data should not be kept longer than necessary for the fulfilment of the purpose for which it is or is to be used and shall be erased if it is no longer required, unless erasure is prohibited by law or is not in the public interest. The PDPO also confers on the Privacy Commissioner for Personal Data (“Privacy Commissioner”) power to conduct investigations and institute prosecutions. The data protection principles (collectively, the “DPP” or the “Data Protection Principles”), which are contained in Schedule 1 to the PDPO, outline how data users should collect, handle, and use personal data, complemented by other provisions imposing further compliance requirements. The collective objective of DPPs is to ensure that personal data is collected on a fully informed basis and in a fair manner, with due consideration towards minimizing the amount of personal data collected. Once collected, the personal data should be processed in a secure manner and should only be kept for as long as necessary for the fulfilment of the purposes of using the data. Use of the data should be limited to or related to the original collection purpose. Data subjects are given certain rights, inter alia: (a) the right to be informed by a data user whether the data user holds personal data of which the individual is the data subject; (b) if the data user holds such data, to be supplied with a copy of such data; and (c) the right to request correction of any data they consider to be inaccurate. The Privacy Commissioner may carry out criminal investigations and institute prosecution for certain offenses. Depending on the severity of the cases, the Privacy Commissioner will decide whether to prosecute or refer cases involving suspected commission to the Department of Justice of Hong Kong. Victims may also seek compensation by civil action from data users for damage caused by a contravention of the PDPO. The Commissioner may provide legal assistance to the aggrieved data subjects if the Commissioner deems fit to do so.

We believe that we have been in compliance with the data privacy and personal information requirements of the PDPO. Moreover, we do not expect to be subject to any cybersecurity review by Hong Kong and PRC government authorities for this Offering. However, if we or our Operating Subsidiary conducting business operations in Hong Kong have violated certain provisions of the PDPO, we could face significant civil penalties and/or criminal prosecution, which could adversely affect our business, financial condition, and results of operations.

If the PRC government chooses to extend the oversight and control over offerings that are conducted overseas and/or foreign investment in Mainland China-based issuers to Hong Kong-based issuers, such action may significantly limit or completely hinder our ability to offer or continue to offer Class A Ordinary Shares to investors and cause the value of our Class A Ordinary Shares to significantly decline or be worthless.

Recent statements, laws and regulations by the PRC government, including the Measures for Cybersecurity Review (2021), the PRC Personal Information Protection Law and the Trial Administrative Measures published by CSRC on February 17, 2023, which came into effect on March 31, 2023,also have indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investments in Mainland China-based issuers. It remains uncertain as to the enactment, interpretation and implementation of regulatory requirements related to overseas securities offering and other capital markets activities and due to the possibility that laws, regulations, or policies in the PRC could change rapidly in the future.

It remains uncertain whether the PRC government will adopt additional requirements or extend the existing requirements to apply to our Operating Subsidiary located in Hong Kong. It is also uncertain whether the Hong Kong government will be mandated by the PRC government, despite the constitutional constraints of the Basic Law, to control over offerings conducted overseas and/or foreign investment of entities in Hong Kong, including our Operating Subsidiary. Any actions by the PRC government to exert more oversight and control over offerings (including of businesses whose primary operations are in Hong Kong) that are conducted overseas and/or foreign investments in Hong Kong-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors. If there is a significant change to current political arrangements between Mainland China and Hong Kong, or the applicable laws, regulations, or interpretations change, and, in such event, if we are required to obtain such approvals in the future and we do not receive or maintain the approvals or is denied permission from Mainland China or Hong Kong authorities, we will not be able to list our Class A Ordinary Shares on a U.S. exchange, or continue to offer securities to investors, which would materially affect the interests of the investors and cause significant the value of our Class A Ordinary Shares significantly decline or be worthless.

The enactment of the law of the PRC on Safeguarding National Security in the Hong Kong Special Administrative Region (the “Hong Kong National Security Law”) could impact our Hong Kong subsidiaries, which represent substantially all of our business.

On June 30, 2020, the Standing Committee of the PRC National People’s Congress adopted the Hong Kong National Security Law. This law defines the duties and government bodies of the Hong Kong National Security Law for safeguarding national security and four categories of offenses — secession, subversion, terrorist activities, and collusion with a foreign country or external elements to endanger national security — and their corresponding penalties. On July 14, 2020, former U.S. President Donald Trump signed the Hong Kong Autonomy Act, or HKAA, into law, authorizing the U.S. administration to impose blocking sanctions against individuals and entities determined to have materially contributed to the erosion of Hong Kong’s autonomy. On August 7, 2020, the U.S. government imposed HKAA-authorized sanctions on eleven individuals, including former and current Chief Executives of HKSAR, Carrie Lam and John Lee, respectively. On October 14, 2020, the U.S. State Department submitted to relevant committees of Congress the report required under HKAA, identifying persons materially contributing to “the failure of the Government of China to meet its obligations under the Joint Declaration or the Basic Law.” The HKAA further authorizes secondary sanctions, including the imposition of blocking sanctions, against foreign financial institutions that knowingly conduct a significant transaction with foreign persons sanctioned under this authority. The imposition of sanctions may directly affect foreign financial institutions and any third parties or clients dealing with any foreign financial institution that is targeted. It is difficult to predict the full impact of the Hong Kong National Security Law and HKAA on Hong Kong and companies located in Hong Kong. If our Hong Kong subsidiaries, which represent substantially all of our business, are determined to be in violation of the Hong Kong National Security Law or the HKAA by competent authorities, our business operations, financial position and results of operations could be materially and adversely affected.

The enforcement of laws and rules and regulations in PRC can change quickly with little advance notice. Additionally, the PRC laws and regulations and the enforcement of such that apply or are to be applied to Hong Kong can change quickly with little or no advance notice. As a result, the Hong Kong legal system embodies uncertainties which could limit the availability of legal protections, which could result in a material change in our Operating Subsidiary’s operations and/or the value of the securities we are offering.

As one of the conditions for the handover of the sovereignty of Hong Kong to the PRC, the PRC accepted conditions such as Hong Kong’s Basic Law. The Basic Law guaranteed a high degree of autonomy for Hong Kong which ensured Hong Kong will retain its currency (the Hong Kong Dollar), legal system, parliamentary system, and people’s rights and freedom for fifty years from 1997. This agreement has given Hong Kong the freedom to function with a high degree of autonomy. The Special Administrative Region of Hong Kong is responsible for its domestic affairs, including, but not limited to, the judiciary and courts of last resort, immigration, and customs, public finance, currencies, and extradition. Hong Kong continues using the English common law system.

However, if there are any changes in relation to the political arrangements which allows Hong Kong to function autonomously, this could potentially impact Hong Kong’s common law legal system and may in turn bring about uncertainty in, for example, the enforcement of our contractual rights. This could, in turn, materially and adversely affect our Operating Subsidiary’s business and operations. Accordingly, we cannot predict the effect of future developments in the Hong Kong legal system, including the promulgation of new laws, changes to existing laws or the interpretation or enforcement thereof, or the pre-emption of local regulations by national laws. These uncertainties could limit the legal protections available to us, including the ability to enforce agreements with the clients.

There are political risks associated with conducting business in Hong Kong.

All of our operations are in Hong Kong. Accordingly, the business operations and financial conditions of our Operating Subsidiary will be affected by the political and legal developments in Hong Kong. Any adverse economic, social and/or political conditions, material social unrest, strike, riot, civil disturbance or disobedience, as well as significant natural disasters, may affect the market and may adversely affect our operations. Given the relatively small geographical size of Hong Kong, any of such incidents may have a widespread effect on our business operations, which could in turn adversely and materially affect our business, results of operations and financial condition.

Hong Kong is a special administrative region of the PRC and the basic policies of the PRC regarding Hong Kong are reflected in the Basic Law, namely, Hong Kong’s constitutional document, which provides Hong Kong with a high degree of autonomy and executive, legislative and independent judicial powers, including that of final adjudication under the principle of “one country, two systems”. However, there is no assurance that there will not be any changes in the political arrangement between PRC and Hong Kong and the economic, political and legal environment in Hong Kong in the future. Some international observers, human rights organizations, governments have expressed doubts about the future of the relative autonomy enjoyed by Hong Kong and the PRC’s pledge to the “one country, two systems” political arrangement in Hong Kong. For example, on January 30, 2024, the Hong Kong government formally launched the legislative process to introduce domestic security legislation under Article 23 of the Basic Law (The law is set to prohibit seven types of offenses, including treason, espionage, and theft of state secrets, and the proposal of which was withdrawn due to mass opposition in 2003), which the international observers, human rights organizations, government considered the proposed Article 23 legislation might have further significantly undermined autonomy of Hong Kong. It is difficult for us to predict the development of the proposed Basic Law Article 23 legislation, or if it is enacted, the degree of its adverse impact on Hong Kong or our business in Hong Kong. However, in any event, since all of our operations are based in Hong Kong, any change of the political arrangements between Hong Kong and the PRC may pose an adverse impact to the stability of the economy in Hong Kong, thereby directly and adversely affecting our results of operations and financial positions.

Lastly, based on several development including the Hong Kong National Security Law passed in June 2020, the U.S. State Department has indicated that the United States no longer considers Hong Kong to have significant autonomy from China and President Trump signed an executive order and Hong Kong Autonomy Act, or HKAA, to remove Hong Kong’s preferential trade status and to authorize the U.S. administration to impose blocking sanctions against individuals and entities who are determined to have materially contributed to the erosion of Hong Kong’s autonomy. The United States may impose the same tariffs and other trade restrictions on exports from Hong Kong that it places on goods from Mainland China. These and other recent actions may represent an escalation in political and trade tensions involving the U.S, China and Hong Kong, which could potentially harm our business. It is difficult to predict

the full impact of the HKAA on Hong Kong and companies with operations in Hong Kong like us. Furthermore, legislative or administrative actions in respect of China-U.S. relations could cause investor uncertainty for affected issuers, including us, and the market price of our Class A Ordinary Shares could be adversely affected.

The Hong Kong regulatory requirement of prior approval for the transfer of shares in excess of a certain threshold may restrict future takeovers and other transactions.

Section 132 of the Securities and Futures Ordinance (Chapter 157 of the Laws of Hong Kong) (the “SFO”) requires prior approval from the HKSFC for any company or individual to become a substantial shareholder of a HKSFC-licensed corporation in Hong Kong. Under the SFO, a person will be a “substantial shareholder” of a licensed company if he, either alone or with associates, has an interest in, or is entitled to control the exercise of, the voting power of more than 10% of the total number of issued shares of the licensed corporation, or exercises control of 35% or more of the voting power of a company that controls more than 10% of the voting power of the licensed company. Further, all potential parties who will be the new substantial shareholder(s) of our HKSFC-licensed subsidiary, Red Solar, are required to seek prior approval from the HKSFC. This regulatory requirement may discourage, delay or prevent a change in control of the Company, which could deprive the holders of our Class A Ordinary Shares of the opportunity to receive a premium for their Class A Ordinary Shares as part of a future sale and may reduce the price of our Class A Ordinary Shares upon the consummation of a future proposed business combination.

Fluctuations in exchange rates could have a material and adverse effect on our results of operations and the value of your investment.

Our revenues and expenses will be denominated predominantly in Hong Kong dollars, which is the currency of Hong Kong, and the financial statements that we file with the SEC and provide to our shareholders are presented in United States dollars. Although the exchange rate between the Hong Kong dollar to the U.S. dollar has been pegged since 1983, we cannot assure you that the Hong Kong dollar will remain pegged to the U.S. dollar. Any significant fluctuations in the exchange rates between Hong Kong dollars to U.S. dollars may have a material adverse effect on our revenue and financial condition. For example, to the extent that we are required to convert U.S. dollars we receive from this Offering into Hong Kong dollars for our operations, fluctuations in the exchange rates between Hong Kong dollars against the U.S. dollar would have an adverse effect on the amounts we receive from the conversion. We have not used any forward contracts, futures, swaps or currency borrowings to hedge our exposure to foreign currency risk.

Risks relating to the Industry in which we Operate

Our operations are concentrated in Hong Kong. Our business performance is highly influenced by the conditions of capital and financial market in Hong Kong. Unfavorable market and economic conditions and the material deterioration of the political and regulatory environment in Hong Kong, Mainland China, and elsewhere in the world could materially and adversely affect our business, financial condition, prospects, and results of operations.

All our business operations were carried out in Hong Kong, and as the financial service provider for the capital market sectors of Hong Kong. Our results of operations and prospects are highly susceptible to any development of change in government policies, as well as economic, social, political and legal development in Hong Kong. Events with adverse impacts on investors’ confidence and risk appetites, such as riots or mass civil disobedience movements and general deterioration of the local economy, may lead to a reduction in investment or trading activities and in turn our business performance. Any change in the Hong Kong local economic, social and political environment, all of which are beyond our control, may lead to a prolonged period of sluggish market activities which would in turn have material adverse impact on our business.

The capital market and the economic conditions in general of Hong Kong are highly sensitive to conditions of the capital markets, political, social and economic conditions in Mainland China and globally. When there are unfavorable changes to the global or local market conditions, the capital market and the economy in Hong Kong may experience negative fluctuations in its performance. Any prolonged slowdown in the global or Chinese economy may affect potential clients’ confidence in the capital market as a whole and have a negative impact on our business as a whole, the demand for our services, our pricing strategies, the level of our business activities and consequently our revenue derived therefrom. This may materially and adversely affect our financial condition and the results of operations. Additionally, continued turbulence in the international financial markets may adversely affect our ability to access the capital markets to meet liquidity needs. Financial markets and economic conditions could be negatively impacted by

many factors, both economically and politically, beyond our control, such as the inability to access capital markets, control of the foreign exchange, changes in exchange rates, rising interest rates or inflation, slowing or negative growth rate, government involvement in the allocation of resources, inability to meet financial commitments in a timely manner, terrorism, pandemics such as the Covid-19 pandemic, political uncertainty, Russo — Ukraine war, the outcome of the Sino — US trade dispute, civil unrest, fiscal or other economic policy of Hong Kong or other governments, and the timing and nature of any regulatory reform.

The current heightened tensions in international economic relations, such as the one between the United States and China, may also give rise to uncertainties in global economic conditions and adversely affect the capital market of Hong Kong. Amid these tensions, the U.S. government has imposed and may impose additional measures on entities in China, including sanctions. The U.S. government has imposed and has continued to propose to impose additional, new, or higher tariffs on certain products imported from China to penalize China for what it characterizes as unfair trade practices. China has responded by imposing, and proposing to impose additional, new, or higher tariffs on certain products imported from the United States. Unfavorable financial market and economic conditions in Hong Kong, Mainland China, and elsewhere in the world, and the escalations of the tensions that affect trade relations may lead to slower growth in the global economy in general, could negatively affect our clients’ business and materially reduce demand for our services and increase price competition among financial services firms seeking such engagements, and thus could materially and adversely affect our business, financial condition, and results of operations. In addition, our profitability could be adversely affected due to our fixed costs and the possibility that we would be unable to reduce our variable costs without reducing revenues or within a timeframe sufficient to offset any decreases in revenues relating to changes in the market and economic conditions.

Given the close tie between Hong Kong and Mainland China, the stability of the Hong Kong economy and domestic market is susceptible to the general economic, political and regulatory environment in Mainland China. A significant portion of our revenue is derived from our clients which are based and operate in Mainland China. For the years ended June 30, 2023 and 2022, respectively, approximately 45.7% and 37.2% of our revenue is derived from our services for listed companies and/or listing applicants which are based in Mainland China. As such, our continued profitability will depend to a material extent on the ability of our Mainland China clients to conduct fundraising activities, IPO, or securities offering in Hong Kong. Any material adverse changes in the economic performance, political situations and regulations in relation to the financial and securities market in Mainland China may adversely affect Mainland China-based companies’ desire to participate in the financial and securities market in Hong Kong. This may lower their demand for our services and in turn adversely affect our financial condition and results of operations. The economy of Mainland China differs from the economies of most developed countries in a number of aspects, such as the extent of government intervention, growth rate, and control of the foreign exchange. In particular, the PRC government exerts substantial control over the growth of the domestic economy by means of, among others, resource allocation as well as setting policy on foreign exchange. There is no assurance that the PRC government will not implement reforms or policies which may drastically (i) restrict Mainland China investors from investing abroad and in Hong Kong; and/or (ii) restrict Mainland China companies and businesses to participate in the capital market in Hong Kong.

Such intervention or policies changes may potentially affect the attractiveness of Hong Kong as an alternative venue for Mainland China business to conduct fundraising activities and securities offering in Hong Kong, or reduce the willingness of Mainland China investors to trade securities, or otherwise diminish the securities and financial market of Hong Kong, given the substantial reliance of Hong Kong financial and securities on the business and companies based in Mainland China. If China implements market-oriented reforms involving unprecedented or experimental revision of its economic reform measures, there is no guarantee that adjustments to its policies will not negatively affect our operations and business development.

Furthermore, the outbreak of war in Ukraine has already affected global economic markets, and the uncertain resolution of this conflict could result in protracted and/or severe damage to the global economy. Russia’s military action in Ukraine have led to, and may lead to, additional sanctions being levied by the United States, European Union and other countries against Russia. Russia’s military incursion and the resulting sanctions could adversely affect global energy and financial markets and thus could affect our client’s business and our business, even though we do not have any direct exposure to Russia or the adjoining geographic regions. The extent and duration of the military action, sanctions, and resulting market disruptions are impossible to predict but could be substantial. Any such disruptions caused by Russian military action or resulting sanctions may magnify the impact of other risks described in this section. We are currently actively monitoring the situation in Ukraine, however, we cannot predict

the progress or outcome of the situation in Ukraine, as the conflict and governmental reactions are rapidly developing and beyond their control. Prolonged unrest intensified military activities, or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on the operations, results of operations, financial condition, liquidity and business outlook of our business.

The corporate finance services industry in Hong Kong is fiercely competitive, and we may lose our competitiveness to our competitors.

The financial and securities services industry in Hong Kong is highly competitive due to the vast number of market players in providing corporate finance advisory services similar to ours. Our competitors may have longer operating history, better brand recognition and reputation, proven track record, operations in more geographic locations, stronger human and financial resources, wider range of services and stronger shareholders’ background than us. We expect that there will be more market players entering into the market and competition will be intensified. New participants may enter into the market insofar as they have engaged appropriate qualified professionals and obtained the requisite regulatory licenses and permits. Given the keen competition, we cannot assure that we will be able to maintain our competitive edge in response to the fast-changing business environment. In addition, competition creates an unfavorable pricing environment in the market in which we operate. Intensified competition may cause us to reduce our service fees in order to compete with other market players, which could place significant pressure on our ability to maintain gross margins and is particularly acute during market slowdowns, and will in turn materially and adversely affect our market share, financial condition and results of operations.

We are subject to extensive and evolving regulatory requirements, the non-compliance with which may result in penalties, limitations, and prohibitions on our future business activities or suspension or revocation of our licenses, and consequently may materially and adversely affect our business, financial condition, and results of operations. In addition, we may, from time to time, be subject to regulatory inquiries and investigations by relevant regulatory authorities or government agencies in Hong Kong or other applicable jurisdictions.

The Hong Kong financial market and corporate finance services industry in which we primarily operate are highly regulated. Our business operations are subject to applicable laws, regulations, guidelines, circulars, and other regulatory guidance, and many aspects of our businesses depend on obtaining and maintaining approvals, licenses, permits, or qualifications from the relevant regulators. Serious non-compliance with regulatory requirements could result in investigations and regulatory actions, which may lead to penalties, including reprimands, fines, limitations, or prohibitions on our future business activities or, if significant, suspension or revocation of our licenses. Failure to comply with these regulatory requirements could limit the scope of businesses in which we are permitted to engage. Furthermore, additional regulatory approvals, licenses, permits, or qualifications may be required by relevant regulators in the future, and some of our current approvals, licenses, permits, or qualifications are subject to periodic renewal. Although our Operating Subsidiary, Red Solar, was not subject to any public disciplinary actions by the HKSFC for the last five years, any such public disciplinary actions may affect our ability to conduct business, harm our reputation and, consequently, materially and adversely affect our business, financial condition, results of operations, and prospects.

Our Operating Subsidiary, Red Solar, is an HKSFC-licensed corporation that is subject to various requirements, such as remaining fit and proper at all times, minimum liquid and paid-up capital requirements, notification requirements, submission of audited accounts, submission of financial resources returns and annual returns, continuous professional training, under the SFO of Hong Kong and its subsidiary legislation and the codes and the guidelines issued by the HKSFC from time to time. If Red Solar fails to meet the regulatory capital requirements in Hong Kong, the local regulatory authorities may impose penalties on us or limit the scope of our business, which could, in turn, have a material adverse effect on our financial condition and the results of operations. Moreover, the relevant capital requirements may be changed over time or subject to different interpretations by relevant governmental authorities, all of which are out of our control. Any increase in the relevant capital requirements or stricter enforcement or interpretation of the same may adversely affect our business activities. Any non-compliance with applicable laws, regulations, guidance or codes or any negative findings made by the regulators may result in (i) fines, deterrent penalties, or disciplinary actions against us, our Responsible Officers, Licensed Representatives or any of our personnel; or (ii) suspension or revocation of some or all of (a) our registrations or licenses for carrying on our business activities; or (b) the approvals or licenses granted to our personnel enabling them to carry out their responsibilities in our Group. For instance, conditions may

be imposed on our licenses restricting us from carrying on our business, or our Responsible Officers or Licensed Representatives may be banned from the industry for a specific period of time. Accordingly, our business operation, reputation, financial condition, and results of operations might be materially and adversely affected.

Furthermore, any material changes to the laws and regulations applicable to us could significantly affect our operations. We cannot assure you that the business model and operations we currently have in place would be in compliance with any changes or updates to the regulatory requirements. Costs of compliance could increase and our fee structure may have to be adjusted. For instance, we may need to increase our headcounts if requirements over sponsor work become more stringent or obtain more licenses if the licensing requirements change. The sanctions imposed by the HKSFC against large sponsor firms for substandard due diligence in several recent widely-publicized cases demonstrate that the HKSFC expects high standards of sponsor’s conduct and we will need to continue to enhance our internal controls and systems in respect of our sponsor work in accordance with new regulatory requirements or guidance.

From time to time, Red Solar may be subject to or required to assist in inquiries or investigations by relevant regulatory authorities or government agencies in Hong Kong or other jurisdictions, including the HKSFC, relating to its own activities or activities of third parties such as its clients. The HKSFC conducts on-site reviews and off-site monitoring to ascertain and supervise our business conduct and compliance with relevant regulatory requirements and to assess and monitor, among other things, our financial soundness. We, our directors, or our employees, may be subject to such regulatory inquiries and investigations from time to time, regardless of whether we are the target of such regulatory inquiries and investigations. If any misconduct is identified as a result of inquiries, reviews or investigations, the HKSFC may take disciplinary actions that would lead to revocation or suspension of licenses, public or private reprimand or imposition of pecuniary penalties against us, our responsible officers, licensed representatives, directors, or other officers. Any such disciplinary actions taken against us, our responsible officers, licensed representatives, directors, or other officers may have a material and adverse impact on our business operations and financial results. In addition, we are subject to statutory secrecy obligations under the SFO of Hong Kong whereby we may not be permitted to disclose details on any HKSFC inquiries, reviews or investigations without the consent of the HKSFC. For further details, see “Regulation — Disciplinary Power of the HKSFC”.

Our business is also subject to regulation by various other governmental agencies in Hong Kong, in addition to the HKSFC, including agencies responsible for monitoring and enforcing compliance with various legal obligations, such as privacy and data protection-related laws and regulations, intellectual property laws, employment and labor laws, workplace safety, trade laws, anti-corruption and anti-bribery laws, and tax laws and regulations. Noncompliance with applicable regulations or requirements could subject us to investigations, enforcement actions, sanctions, disgorgement of profits, fines, civil and criminal penalties or injunctions, termination of contracts, and/or claims for damages by our clients or professional party partners. If any governmental sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, results of operations, and financial condition could be adversely affected. In addition, responding to any action will likely result in a significant diversion of our management’s attention and resources and an increase in professional fees. Enforcement actions and sanctions could materially harm our business, results of operations, and financial condition.

We are affected by the rules and regulations governing listed companies on the Stock Exchange.

During the years ended June 30, 2023 and 2022 and up to the date of this prospectus, we provided corporate finance advisory services to clients who are listing applicants or listed companies or their shareholders or investors on the Stock Exchange. These clients are required to comply with the Main Board Listing Rules, the GEM Listing Rules, the Takeovers Codes and other rules and regulations where applicable. Any changes to such rules and regulations, particularly those affecting the appointment and the role of the sponsors in listing applications and the appointment and the role of financial adviser in specific transactions, may affect the demand for and the scope of our corporate finance advisory services which may in turn materially and adversely affect our results of operations.

Risks Relating to our Business and Operation

We, through our Hong Kong subsidiaries, have a relatively short operating history compared to some of our established competitors and face significant risks and challenges in a rapidly evolving market, which makes it difficult to effectively assess our future prospects.

We have a relatively short operating history compared to some of our established competitors. We started to provide corporate finance advisory services, including listing sponsorship and securities related services, financial advisory, independent financial advisory services, and compliance advisory services in October 2017. We only have a limited operating history with regard to such business upon which an evaluation of our prospects can be based. Our future revenues and cash flows may fluctuate significantly given our short operating history, rendering it difficult to predict our results of operations and prospects.

There is no assurance that we will sustain profitability or positive cash flow from our existing operations or from any expanded or new operations, nor that we will be able, upon the completion of the Offering, to expand operations beyond our current level. You should consider our business and prospects in light of the risks and challenges we encounter or may encounter given the rapidly evolving market in which we operate and our relatively short operating history. These risks and challenges include our ability to, among other things:

•        build a well-recognized Red Solar brand;

•        maintain and expand our client base;

•        ensure that the quality of our services meets client expectations

•        maintain and enhance our relationships with our partners;

•        attract, retain, and motivate qualified employees;

•        anticipate and adapt to changing market conditions and a competitive landscape;

•        manage our future growth;

•        ensure that the performance of our services meets client expectations;

•        maintain or improve our operational efficiency;

•        navigate a complex and evolving regulatory environment;

•        defend ourselves in any legal or regulatory actions against us;

If we fail to address any or all of these risks and challenges, our business may be materially and adversely affected. As our business develops and as we respond to competition, we may continue to introduce new service offerings, make adjustments to our existing services, or make adjustments to our business operations in general. There is no assurance that we will sustain profitability or positive cash flow from our existing operations or from any expanded or new operations, nor that we will be able, upon the completion of the Offering, to expand operations beyond our current level. Any significant change to our business model that does not achieve expected results could have a material and adverse impact on our financial condition and results of operations. It is therefore difficult to effectively assess our future prospects.

We rely on a limited number of key clients for our business, therefore, we are subject to significant client concentration risk.

Our top five clients in aggregate accounted for 75.4% and 67.7% of our total revenues for the years ended June 30, 2023 and 2022. The largest client accounted for 45.2% and 18.9% of our total revenue for the years ended June 30, 2023 and 2022. Our clients are fairly concentrated and we rely on a limited number of key clients during each period of our business. Our client concentration risk is exacerbated due to our reliance on different clients, for different services engaged in different periods, and the fact that the revenue from our corporate finance advisory business was generated on a project-by-project basis and is non-recurring in nature.

We cannot assure you that we will be successful in diversifying our client base, engaging new clients, and reducing our client concentration risk. Our concentration risk may be amplified due to the limited number of listing sponsorship project that we may sponsor in a given year. For example, our largest client for the year ended June 30, 2023 engaged

us for our securities related services, and our largest client for the year ended June 30, 2022 engaged us for our listing sponsorship services. Since our listing sponsorship services and financial and compliance advisory services are non-recurring in nature, there is no assurance that we can continue to secure the engagements comparable to the similar level as year ended June 30, 2023 in the future. If we are unable to continuously secure new sizable mandates, or if the market conditions become unfavorable, our business and the results of operations may be materially and adversely affected. Our goal is to diversify our client base and revenue source and position ourselves as a trusted financial services provider. However, we cannot assure you that we will be successful in diversifying our client base and reducing our client concentration risk. Moreover, if we lose a key client or if a client decides to engage in a competitor, and if we are unable to secure new clients during a period of time in the future, our results of operations, financial conditions, cashflow positions may be adversely and materially impacted.

For our business activities, we are required to comply with regulatory capital requirements and to maintain a high level of funds and liquidity. Failure to comply with these regulatory capital requirements could materially and negatively affect our business operation and overall performance.

As the corporation licensed with the HKSFC to carry on regulated activities, Red Solar, our Operating Subsidiary is required under the SFO and Securities and Futures (Financial Resources) Rules (Chapter 571N of the Laws of Hong Kong) (the “FRR”) to maintain a minimum amount of paid-up share capital and liquid capital. See “Regulations”. As of the date of this prospectus, our Operating Subsidiary was in compliance with the respective regulatory capital requirements. However, there is no assurance that such failure will not happen in the future. Our liquid capital may be tightened when we commence our underwriting and placing services or carry out our proposed expansion plans. Failure to meet the above requirement may cause the HKSFC to suspend our licenses, impose conditions in relation to our regulated activities, or take other appropriate disciplinary actions against us, which may adversely affect our business operations and financial performance. Failure to meet the above requirement could also affect client confidence, our ability to grow, our costs of funds, our ability to pay dividends on Class A Ordinary Shares, our ability to make acquisitions, and in turn, our business, results of operations, and financial condition.

Our revenue and profitability are highly unpredictable, since (i) the revenue from our corporate finance advisory business was generated on a project-by-project basis and is non-recurring in nature; (ii) progress-based payment arrangement; and (iii) possible default or delay of payments from our clients

For years ended June 30, 2023 and 2022, our revenue was primarily derived from our listing sponsorship services, securities related services, financial advisory, independent financial advisory services, and compliance advisory services. Revenue of our corporate finance activities is to a large extent derived from transactions for which we are engaged on a project basis with relevant terms and conditions (including professional fees and payment schedules) being negotiated and determined on a project-by-project basis subject to, amongst other things, the complexity of the transaction, the estimated time commitment and the overall capacity of our project execution team. Since the mandates and the professional fee of the mandates, including the sponsor fee and financial advisory fee, are negotiated on a project-by-project basis, revenue generated from our corporate finance advisory services may fluctuate from time to time and may not recur. There is also no assurance that the clients who have previously sought our services will continue to retain us for future business, and there is no assurance that we can continue to secure our engagements in the future. Therefore, the revenue generated from each client or engagement differs and we cannot assure that our future engagement fee rates will be comparable to those accepted by our clients during the years ended June 30, 2023 and 2022.

The nature of the corporate finance activities also means the demand and scope for our services are dependent on the conditions of the financial markets, which are in turn influenced by a variety of factors (such as investor sentiment or political/economic environments) beyond our control, resulting in uncertainties in relation to the sustainability of our financial performance. Any adverse market condition or market sentiment will affect clients’ decisions on the scale, timing, and stock market choices in respect of their fundraising needs, which may lead to lower demand for, delay to or termination of fundraising activities and our services and in turn affect the financial performance of our corporate finance advisory business. If we are unable to continuously secure new sizable mandates, or if the market conditions become unfavorable, our business and the results of operations may be materially and adversely affected.

In general, service fees we charged for our corporate finance advisory projects are recognized when the underlying services have been provided and/or relevant milestones have been completed in accordance with the terms of our mandates by instalments, which are not necessarily based on the time or costs we have incurred for the project.

The grant of approvals by the regulators such as the Stock Exchange and the HKSFC will usually affect the project timeline. Failure in obtaining the necessary approvals as stipulated or at all could result in the delay or abortion of the transactions. Due to aforesaid nature of our projects and factors beyond our control, in particular our listing sponsorship engagements, it may not be possible to successfully complete each project, and consequently we may not receive the mandated payments in full for services provided or after we have expended substantial effort and time as scheduled or at all. If a milestone is not achieved or if a transaction is terminated before completion, our clients may delay in settling our invoices which are presented to them when due, or not settle them at all. In the case of default payments, if we have already incurred a significant amount of costs and expenditures for the project and the initial retainer fee or any progress payments received do not cover our total costs incurred, our results of operations may be materially and adversely affected. Failures or delays in receiving payments from our clients may adversely affect our cash flow position and our ability to meet the working capital requirement.

In these circumstances, our revenue and profitability may fluctuate from year to year and our financial performance is highly unpredictable.

Our financial advisory and compliance advisory services are related to our listing sponsorship services and any deterioration of our listing sponsorship services may adversely affect our other financial services business.

Revenue generated from our listing sponsorship business contributed significantly to our total revenue. For the years ended June 30, 2023 and 2022, we recognized listing sponsorship income of approximately US$102,076 and US$237,031, respectively, representing approximately 15.0% and 34.9% of our total revenue for the respective periods.

We may cross sell our financial and compliance advisory services to clients of our listing sponsorship projects. As such, our ability to secure listing sponsorship projects may affect our ability to secure the financial and compliance advisory services mandates. Any deterioration in our listing sponsorship services may not only adversely affect our revenue and profit in that segment, but may also adversely affect the revenue and profit of our financial and compliance advisory services.

Our businesses depend on our key management and professional staff, and our business may suffer if we are unable to recruit and retain them.

Our businesses depend on the skills, reputation, and professional experience of our key management executives, the network of resources and relationships they generate during the normal course of their activities, and the synergies among the diverse fields of expertise and knowledge held by our senior professionals. Therefore, the success of our business depends on the continued services of these individuals. If we lose their services, we may not be able to execute our existing business strategy effectively, and we may have to change our current business direction. These disruptions to our business may take up significant energy and resources of our company, and materially and adversely affect our future prospects.

Moreover, our business operations depend on our professional staff, our most valuable asset. Their skills, reputation, professional experience, and client relationships are critical elements in providing quality services to clients, managing our compliance and risk, and obtaining and executing client engagements. We devote considerable resources and incentives to recruiting and retaining these personnel. However, the market for quality professional staff is increasingly competitive. Loss of our professional staff and failure to recruit replacement will materially and adversely affect our business operations. We expect to face significant competition in hiring such personnel. Additionally, as we mature, current compensation scheme to attract employees may not be as effective as in the past. The intense competition may require us to offer more competitive compensation and other incentives to our talent, which could materially and adversely affect our financial condition and the results of operations. As a result, we may find it difficult to retain and motivate these employees, and this could affect their decisions about whether or not they continue to work for us. If we do not succeed in attracting, hiring, and integrating quality professional staff, or retaining and motivating existing personnel, we may be unable to grow effectively.

Where one or more of the regulated activities of our Operating Subsidiary has less than two responsible officers, our Operating Subsidiary will be in breach of the relevant licensing requirements which could adversely affect our licensing status which may jeopardize our business operation

Under the licensing requirements of the SFO, our licensed corporation, which is also our Operating Subsidiary, Red Solar, must have at all times at least two responsible officers to directly supervise the business of each of our regulated activities. At the date of the prospectus, Red Solar has three Responsible Officers for Type 1 (dealing in securities)

and Type 6 (advising on corporate finance) regulated activities under the SFO. In addition, to act as a sponsor and compliance adviser, Red Solar must ensure that there are sufficient Principals engaged in a full time capacity to oversee and supervise our transaction teams with at least two Principals engaged in a transaction team at all times. Without an adequate number of Principals, we cannot accept new engagements and may not be permitted to carry on our current roles as sponsor and compliance adviser.

In the event such number of our Responsible Officers resign, become disqualified or otherwise ineligible to continue their role as Responsible Officer, and at the same time the void created as a result thereof is without immediate and adequate replacement, this may result in a situation where one or more of the two regulated activities of our Operating Subsidiary have fewer than two Responsible Officers. In this case, we will be exposed to operational disruption, and thus may result in a breach of the relevant licensing requirement, which may subsequently result in the suspension of our HKSFC licenses and jeopardize our business operations and financial performance.

Our financial result for the year ending June 30, 2024 is expected to be adversely affected by the non-recurring listing expenses.

We are of the view that the financial result of our Group for the year ending June 30, 2024 is expected to be adversely affected by the listing expenses in relation to the Offering, the nature of which is non-recurring. See “Expenses related to this Offering” for details. Part of the listing expenses is expected to be accounted for as a deduction from equity upon listing while part of the listing expenses has been and is expected to be recognized as expenses in our consolidated statements of income which is expected to be recognized for the year ending June 30, 2024. Accordingly, our results of operation and financial performance for the year ending June 30, 2024 may be adversely impacted, and may or may not be comparable to our financial performance in the past.

We recorded net operating cash outflow for the year ended June 30, 2022.

For the year ended June 30, 2022, we recorded net operating cash outflow of approximately US$190,372. We cannot assure you that we will not record net current liabilities or experience another period of net cash outflow in the future. If we are unable to obtain sufficient funds to finance our business, our liquidity, results of operations and financial condition may be materially and adversely affected. If we need to resort to other financing activities to generate additional cash, we may incur additional financing costs, and we cannot assure you that we will be able to obtain the required financing on terms acceptable to us, or at all, at the material time.

We may not be able to implement our business strategies and future plans successfully.

Our business strategies and future plans are set out in the paragraph headed ‘‘Growth Strategies’’ under the section headed ‘‘Business’’ and in the ‘‘Use of Proceeds’’ section in this prospectus. However, the successful implementation of these strategies and plans depends on a number of factors including but not limited to the following:

•        our ability to recruit and retain qualified and experienced professional staff; in particular, in the recruitment of qualified staff with relevant experience to support the expected commencement of our placing and underwriting services, asset management services, and international capital market services.

•        our ability to cope with increased exposure to financial risk, operational risk, market risk, and credit risk arising from our expanded scope of business;

•        our ability to comply with all regulatory requirements and maintain/obtain the qualifications on the range of financial and securities services we provide or intend to provide to our clients;

•        our ability to secure sufficient financial resources;

•        clients’ acceptance and demand for our services and our ability to compete with our competitors; and

•        our ability to adapt to the changes in the market and government policies.

Many of these factors are beyond our control and by nature, are subject to uncertainty. As such, there is no assurance that our business strategies and future plans can be implemented successfully or may be materialized in accordance with our expected timetable, or at all, despite our capital commitments and investments into the same. Any failure or delay in the implementation of any or all of these strategies and plans may have a material adverse effect on our profitability and prospects.

In addition, our future plans may place substantial demands on our managerial, operational, technological, financial, and other resources. To manage and support our growth, we may need to improve our existing operational and administrative systems, improve our financial and management controls, and enhance our ability to recruit, train and retain existing and/or additional qualified personnel and staff. All of these endeavors will require substantial attention and time from management and significant additional expenditures. We cannot assure you that we will be able to manage any future growth effectively and efficiently, and our ability to capitalize on new business opportunities may be materially and adversely affected if we fail to do so, which could in turn materially and adversely affect our business, results of operations, financial condition, and prospects.

We may undertake acquisitions, investments, joint ventures, or other strategic alliances, which could present unforeseen integration difficulties or costs and may not enhance our business as we expect.

Our strategy includes plans to grow both organically and through possible acquisitions, joint ventures, or other strategic alliances. Joint ventures and strategic alliances may expose us to new operational, regulatory, and market risks, as well as risks associated with additional capital requirements. We may not be able, however, to identify suitable future acquisition targets or alliance partners. Even if we identify suitable targets or partners, the evaluation, negotiation, and monitoring of the transactions could require significant management attention and internal resources and we may be unable to complete an acquisition or alliance on terms commercially acceptable to us. The costs of completing an acquisition or alliance may be costly and we may not be able to access funding sources on terms commercially acceptable to us. Even when acquisitions are completed, we may encounter difficulties in integrating the acquired entities and businesses, such as difficulties in retention of clients and personnel, challenge of integration and effective deployment of operations or technologies, and assumption of unforeseen or hidden material liabilities or regulatory non-compliance issues. Any of these events could disrupt our business plans and strategies, which in turn could have a material adverse effect on our financial condition and results of operations. Such risks could also result in our failure to derive the intended benefits of the acquisitions, strategic investments, joint ventures, or strategic alliances, and we may be unable to recover our investment in such initiatives. We cannot assure you that we could successfully mitigate or overcome these risks.

We may not be able to obtain additional capital when desired, on favorable terms, or at all. If we fail to meet the capital requirement pursuant to the FRR, our business operations and performance will be adversely affected.

We may require additional funding for further growth and development of our business, including any investments or acquisitions we may decide to pursue. Due to the unpredictable nature of the capital markets and our industry, we cannot assure you that we will be able to raise additional capital on terms favorable to us, or at all, if and when required, especially if we experience disappointing operating results. If adequate capital is not available to us as required, our ability to fund our operations, take advantage of unanticipated opportunities, develop or enhance our infrastructure or respond to competitive pressures could be significantly limited, which would adversely affect our business, financial condition and results of operations. If our existing resources are insufficient to satisfy our requirements, we may seek to issue additional equity or debt securities or obtain new or expanded credit facilities. Our ability to obtain external financing in the future is subject to a variety of uncertainties, including our future financial condition, results of operations, cash flows, share price performance, liquidity of international capital and lending markets, and the Hong Kong financial industry. If we do raise additional funds through the issuance of equity or convertible debt securities, the ownership interests of our shareholders could be significantly diluted. These newly issued securities may have rights, preferences or privileges senior to those of existing shareholders. In addition, our HKSFC-licensed Operating Subsidiary is required under the FRR to maintain certain levels of liquid capital. If they fail to maintain the required levels of liquid capital, the HKSFC may take actions against us and our business will be adversely affected.

Our failure to appropriately identify and address conflicts of interest could materially and adversely affect our business

As we expand the scope of our business and our client base, it is critical for us to be able to address actual, potential, or even perceived conflicts of interest, including situations where we may encounter conflicts of interest arising among: (i) our various services, (ii) our clients and us, (iii) our various clients, (iv) our employees and us or (v) our clients and our employees

In light of the complexity and difficulty in appropriately identifying and dealing with potential conflicts of interest, our internal control procedures that are designed to identify and address conflicts of interest may not be sufficient. Our failure to manage conflicts of interest could harm our reputation and erode client confidence in us. In addition, potential or perceived conflicts of interest may also give rise to litigation or regulatory actions. The occurrence of any of the foregoing events could materially and adversely affect our business, results of operations and reputation.

We may be subject to litigation, arbitration, regulatory proceedings, or other legal proceeding risks, in particular, we may be subject to various professional liabilities and claims.

In the ordinary course of our business, we provide professional advice for corporate finance advisory services and provide information in relation to securities transactions to our clients. If our clients rely on such advice or information and incur losses as a result, we could be subject to claims in legal and regulatory proceedings for compensation and/or other relief for negligence, provision of false or misleading information, breach of fiduciary duties or employee misconduct. Although we have adopted relevant internal control measures, we cannot assure that such measures currently in place or as updated from time to time can completely eliminate the aforesaid risks of liabilities and claims. Any claims or lawsuits against us arising from professional negligence and/or employee misconduct and claims from indemnified persons that result in substantial amounts of compensation may have a material and adverse impact on our business activities, reputation, results of operations, and financial conditions.

We and our directors and officers may from time to time become subject to or involved in various claims, controversies, lawsuits, and regulatory/legal proceedings. Claims, lawsuits, and litigations are subject to inherent uncertainties, and we are uncertain whether the foregoing claim would develop into a lawsuit. Lawsuits and litigations may cause us to incur defense costs, utilize a significant portion of our resources and divert management’s attention from our day-to-day operations, any of which could harm our business. Any settlements or judgments against us could have a material adverse impact on our financial condition, results of operations and cash flows. In addition, negative publicity regarding claims or judgments made against us may damage our reputation and may result in a material adverse impact on us.

We have limited business insurance coverage.

We are not required to and do not carry insurance for our license-related business. We do not carry business interruption insurance to compensate for losses that could occur to the extent not required. We also do not maintain professional indemnity insurance or key-man insurance, and only maintain limited medical insurance for our employees. We consider our insurance coverage to be reasonable in light of the nature of our business and in conformity with industry practice, but we cannot assure you that our insurance coverage is sufficient to prevent us from any loss or that we will be able to successfully claim our losses under our current insurance policies on a timely basis, or at all. If we incur any loss that is not covered by our insurance policies, or the compensated amount is significantly less than our actual loss, our business, financial condition, and results of operations could be materially and adversely affected.

Illegal or improper activities, violation of professional standards, and the misconduct of our personnel or third parties could harm our reputation and businesses, and are difficult to detect or deter.

We are subject to the risk of fraud, illegal act or misconduct committed by our directors, licensed employees, agents, clients or other third parties. Misconduct includes entering into unauthorized transaction, improperly using or divulging inside information, recommending transactions not suitable for our clients, engaging in fraudulent activities, or engaging in improper or illegal activities. There is no assurance that our directors, employees, agents, clients or other third parties would not commit incidents of fraud or other misconduct in the future, and we cannot assure that our procedures and policies would fully prevent or detect illegal or improper activities in our business operations. Such incidents may result in investigation and regulatory sanction against us and cause us to suffer financial loss and reputational harm. We may also need to incur costs to commence and participate into any legal proceedings against them to recover our loss. The potential harm to our reputation and to our business caused by such fraud or misconduct is impossible to quantify.

We are also subject to a number of obligations and standards arising from our business. The violation of these obligations and standards by any of our directors, officers, employees, agents, clients, or other third parties could materially and adversely affect us and our investors. For example, we are required to properly handle confidential information. If our directors, officers, employees, agents, clients, or other third parties were to improperly use or disclose confidential information, we could suffer serious harm to our reputation, financial position, and existing and future business relationships.

Any negative publicity with respect to our Group, our directors, officers, employees, shareholders, or other beneficial owners, our peers, professional parties partners, or our industry in general, may materially and adversely affect our reputation, business, and results of operations.

Our reputation and brand recognition play an important role in earning and maintaining the trust and confidence of our existing and prospective clients. We and our services are vulnerable to adverse market perception as we operate in an industry where integrity, client trust and confidence are critical. Litigation and disputes, misconduct of our personnel, changes in senior personnel, client complaints, outcome of regulatory investigations or penalties imposed on us may harm our reputation. Any harm to our reputation or damages caused by third parties illegitimately disguised as us, may cause our existing and potential clients to be reluctant to procure services from us in the future and therefore may have a material adverse impact on our business, operations and financial results. We cannot assure that such negative events will not happen in the future. Negative publicity or media coverage about us, such as alleged misconduct, other improper activities, litigation or disputes, regulatory enquiries or enforcement actions taken against us or our employees, or negative rumors relating to our business, shareholders, or other beneficial owners, affiliates, directors, officers, or other employees, can harm our reputation, business, and results of operations, even if they are baseless or satisfactorily addressed.

These allegations, even if unproven or meritless, may lead to inquiries, investigations, or other legal actions against us by any regulatory or government authorities. Any regulatory inquiries or investigations and lawsuits against us, and perceptions of conflicts of interest, inappropriate business conduct by us or perceived wrongdoing by any key member of our management team, among other things, could substantially damage our reputation regardless of their merits, and cause us to incur significant costs to defend ourselves. As we reinforce our ecosystem and stay close to our clients and other stakeholders, any negative market perception or publicity on professional parties that we closely cooperate with, or any regulatory inquiries or investigations and lawsuits initiated against them, may also have an impact on our brand and reputation, or subject us to regulatory inquiries or investigations or lawsuits. Moreover, any negative media publicity about the financial services industry in general or product or service quality problems of other firms in the industry in which we operate, including our competitors, may also negatively impact our reputation and brand. If we are unable to maintain a good reputation or further enhance our brand recognition, our ability to attract and retain clients, third-party partners, and key employees could be harmed and, as a result, our business, financial position, and results of operations would be materially and adversely affected.

Our business and prospects may be materially and adversely affected if our risk management and internal control systems are ineffective or inadequate. We may fail to update our risk management policies and procedures as needed and such policies and procedures may otherwise be ineffective, which may expose us to unidentified or unexpected risks.

We are dependent on our risk management and internal control policies and procedures and the adherence to such policies and procedures by our risk management and other staff to manage the risks inherent in our business. Any deficiencies in our internal control systems could (i) adversely affect our ability to timely and accurately record, process, summarize and report financial or other data; and (ii) adversely affect our operational efficiency and increase the potential likelihood of making financial reporting errors and/or lead to non-compliance with rules and regulations. Our policies, procedures and practices used to identify, monitor and control a variety of risks are carried out by the corresponding departments. However, some of our methods for managing risks are discretionary by nature and are based on internally developed controls and observed historical market behavior, and also involve reliance on standard industry practices. These methods may not adequately prevent losses, particularly as they relate to extreme market movements, which may be significantly greater than historical fluctuations in the market. There is no assurance that our internal control policies in place could or would be properly implemented, or be strictly adhered to, or are adequate or effective under the continuously changing business environment in which we operate. In addition, we may fail to update our risk management system as needed and the system may fail to effectively function, thus exposing us to unidentified or unexpected risks.

We may not be able to fully detect money laundering and other illegal or improper activities in our business operations on a timely basis or at all, which could subject us to liabilities and penalties.

We are required to comply with applicable anti-money laundering and anti-terrorism laws and other regulations in the jurisdictions where we operate. Although we have adopted policies and internal control procedures aimed at detecting, and preventing being used for, money-laundering activities by criminals or terrorist-related organizations and

individuals, or improper activities, and ensure compliance with licensing and regulatory requirements, in light of the complexity of money-laundering activities and other illegal or improper activities, such policies and procedures may not completely eliminate the possibility of third parties using our business platform to engage in money laundering and/or other illegal or improper activities. There is no assurance that the internal control system in place will prove at all times adequate and effective to deal with all the possible risks given the fast changing financial and regulatory environment in which we operate. Such deficiencies or inherent limitations may result in fines or disciplinary actions against us imposed by regulators, and may adversely affect our financial condition and results of operations.

Furthermore, we primarily comply with applicable anti-money laundering laws and regulations in Hong Kong (for example, the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Chapter 615 of the Laws of Hong Kong) and the Guideline on Anti-Money Laundering and Counter-Financing of Terrorism (For Licensed Corporations) issued by the HKSFC), and we may not fully detect violations of anti-money laundering regulations in other jurisdictions or be fully compliant with the anti-money laundering laws and regulations in other jurisdictions to which we are required. After we become a publicly listed company in the United States, we will also be subject to the U.S. Foreign Corrupt Practices Act of 1977 and other laws and regulations in the United States, including regulations administered by the U.S. Department of Treasury’s Office of Foreign Asset Control. To the extent that our policies and procedures currently in place fail to detect and prevent money-laundering activities, terrorist financing and other illegal or improper activities by our Directors, employees, agents, clients or other third parties and/or if we fail to fully comply with the applicable laws and regulations, the relevant government authorities may initiate investigation against us, and may impose fines and/or other penalties on us, any of which may significantly and adversely affect our reputation, business operations and financial results.

We may be unable to successfully implement or implement in full our future business plans.

Our success is dependent on, among other things, our proper and timely execution of our future business plans. Our future business plans may be hindered by factors beyond our control, such as competition within the industry we operate, our ability to cope with high exposure to financial risk, operational risk, market risk and credit risk as our business and client base expands and our ability to provide, maintain and improve the level of human and other resources in servicing our clients. As such, we cannot assure that our future business plans will materialize, or that our objectives will be accomplished fully or partially, or our business strategies will generate the intended benefits to us as initially contemplated. If we fail to implement our business development strategies successfully, our business performance, financial condition and future prospects and growth could be materially and adversely affected.

We may in the future pursue acquisitions and joint ventures as part of our growth strategy. Any future acquisition or joint venture may result in exposure to potential liabilities of the acquired companies, significant transaction costs and present new risks associated with entering additional markets or offering new products and integrating the acquired companies or newly established joint ventures. Moreover, we may not have sufficient management, financial and other resources to integrate companies we acquire or to successfully operate joint ventures and we may be unable to profitably operate our expanded company structure. Additionally, any new business that we may acquire or joint ventures we may form, once integrated with our existing operations, may not produce expected or intended results.

Our business, operating results and financial condition, have been, and may continue to be, materially and adversely affected by sustained outbreak of the coronavirus (COVID-19).

Since early 2020, the ongoing COVID-19 pandemic has led governments across the globe to impose a series of measures intended to contain its spread, including border closures, travel bans, quarantine measures, social distancing, and restrictions on business operations and large gatherings, and has caused significant disruption to worldwide economic activities, including economic activities in Hong Kong (where we operate in), and in Mainland China (where our significant portion of the client and potential client locate).

Although COVID-19 vaccination program had been greatly promoted around the globe, several types of COVID-19 variants emerged in different parts of the world. The COVID-19 pandemic in Hong Kong in early 2022 has resulted in temporary pandemic-related lockdowns. This outbreak of COVID-19 caused companies such as ours, as well as our business partners and clients, to implement temporary adjustments to work schedules and travel plans, mandating employees to work from home and collaborate remotely. As a result, we have experienced lower efficiency and productivity, internally and externally, which may adversely affect our service quality. Moreover, our business depends

on our employees. If any of our employees has contracted or is suspected of having contracted COVID-19, these employees will be required to be quarantined and they could pass it to other of our employees, potentially resulting in severe disruption to our business.

At the date of the prospectus, most countries around the globe have abolished the measures to contain COVID-19 pandemic and “back to normal”, and the Hong Kong government has gradually abolished its entry-restrictions and Covid-19 control measures since November 2022. Furthermore, the PRC government has also significantly lessened its travel restrictions and abolished the quarantine requirements for international arrivals to Mainland China from January 8, 2023. However, before their abolishment, the aforesaid travel restrictions, quarantine and social control measures in Hong Kong and the Mainland China had severely hindered our client development efforts in Mainland China, and our businesses and clients have been adversely affected by travel restrictions preventing PRC residents from travelling to Hong Kong.

Furthermore, our results of operations have been affected by the COVID-19 outbreak. Due to the instability of global financial markets and other economic and financial challenges brought about by COVID-19, the deterioration of the economic condition of Mainland China due to the continuous COVID-19 control measures, the significant market volatility and declines in general economic activities in Hong Kong and globally, have severely dampened the confidence of our client in the global and Hong Kong’s financial markets. The pandemic, government measures in response to the pandemic, and the global economy deterioration, could result in an economic downturn in Hong Kong in the future. Such a downturn in Hong Kong’s economy may lead to a decline in our consumers’ demands for our services, which could adversely affect our business and, in turn, negatively impact our business and results of operations. Given the general slowdown in economic conditions globally, volatility in the capital markets as well as the general negative impact of the COVID-19 outbreak on the corporate finance markets, we cannot assure you that we will be able to maintain the growth rate we have experienced or projected. Any future impact on our results of operations will depend on, to a large extent, future developments and new information that may emerge regarding the duration and severity of the COVID-19 pandemic and the actions taken by government authorities and other entities to contain the spread or treat its impact, almost all of which are beyond our control. We will continue to closely monitor the situation throughout 2023 and beyond.

We may incur losses or experience disruption of our operations as a result of unforeseen or catastrophic events, including pandemics, terrorist attacks, or natural disasters.

Our business could be materially and adversely affected by catastrophic events or other business continuity problems, such as natural or man-made disasters, pandemics such as Covid-19, Fire, floods, typhoons, earthquakes, power loss, telecommunications failures, break-ins, war, riots, political unrest, terrorist attacks or similar events may give rise to server interruptions, breakdowns, system failures, technology platform failures or Internet failures, which could cause the loss or corruption of data or malfunctions of software or hardware as well as adversely affect our ability to operate, including communicating with clients and the relevant listing authorities. Moreover, besides COVID-19, our business and ability to operate could also be adversely affected by Ebola virus disease, Zika virus disease, H1N1 flu, H5N1 flu, H7N9 flu, avian flu, Swine flu, SARS or other epidemics.

Our headquarters are located in Hong Kong, where our directors and management and a majority of our employees currently reside. Consequently, we are highly susceptible to factors adversely affecting Hong Kong. A disaster or a disruption in the infrastructure that supports our businesses, a disruption involving electronic communications or other services used by us or third parties with whom we conduct business, or a disruption that directly affects our headquarters, could have a material adverse impact on our ability to continue to operate our business without interruption. Our business could also be adversely affected if our employees are affected by pandemics. In addition, our results of operations could be adversely affected to the extent that any pandemic harms the Chinese or Hong Kong economy in general. The incidence and severity of disasters or other business continuity problems are unpredictable, and our inability to timely and successfully recover could materially disrupt our businesses and cause material financial loss, regulatory actions, reputational harm, or legal liability.

Inflation, especially the increases in labor costs, may adversely affect our business and results of operations.

The economy in Hong Kong and globally has experienced general increases in inflation and labor costs in recent years. As a result, average wages in Hong Kong and certain other regions are expected to continue to increase. In addition, we are required by Hong Kong laws and regulations to pay various statutory employee benefits, including mandatory

provident fund for the benefit of our employees. The relevant government agencies may examine whether an employer has made adequate payments to the statutory employee benefits, and those employers who fail to make adequate payments may be subject to fines and other penalties. We expect that our labor costs, including wages and employee benefits, will continue to increase. Unless we are able to control our labor costs or pass on these increasing labor costs, our financial condition and results of operations may be adversely affected.

Our costs and expenses may remain constant or increase even if our revenues decline.

A significant portion of our operating costs, including salary and rent, is fixed. Accordingly, a decrease in our revenues could result in a disproportionately higher decrease in our earnings because our operating costs and expenses may not decrease proportionately. In addition, our staff costs and rent may increase over time. However, we cannot assure you that we have the ability to pass increased costs on to our clients through service fee increases as it depends on a variety of factors beyond our control such as the global economic environment and stock market conditions. Therefore, our costs and expenses may remain constant or increase even if our revenues decline, which would adversely affect our net margins and results of operations.

We are exposed to risks associated with retention and recruitment of licensed and/or qualified personnel.

We rely heavily on human resources for the provision of corporate finance advisory services. For years ended June 30, 2023 and 2022, our staff costs and employee benefits amounted to approximately US$309,291 and US$544,234, respectively, accounting for approximately 37.9% and 80.4% of our operating expenses, for the respective years.

Should the pace of business growth lag behind the pace of increase in headcount, there may be negative impact on our financial results and business performance. In addition, benefits to be generated from the enhancement of human resources may not be as significant as expected due to factors beyond our control, such as the general market conditions, labor market, competition for talents against other financial services providers, travel restrictions and border control due to COVID -19, and the economic and political environment in Hong Kong and overseas. Such factors may cause a delay in realizing our business growth our expansion plan and hence, our financial results, in particular our profitability, may be adversely affected. There is also no assurance that we can employ sufficient number of suitable and competent staff to implement our growth strategies.

Our management team lacks experience in managing a U.S. public company and complying with laws applicable to such company, the failure of which may adversely affect our business, financial condition and results of operations.

Our current management team lacks experience in managing a U.S. publicly traded company, interacting with public company investors and complying with the increasingly complex laws pertaining to U.S. public companies. Prior to the completion of this Offering, we were a private company mainly operating our businesses in Hong Kong. As a result of this Offering, our company will become subject to significant regulatory oversight and reporting obligations under the federal securities laws and the scrutiny of securities analysts and investors, and our management currently has no experience in complying with such laws, regulations and obligations. Our management team may not successfully or efficiently manage our transition to becoming a U.S. public company. These new obligations and constituents will require significant attention from our senior management and could divert their attention away from the day-to-day management of our business, which could adversely affect our business, financial condition and results of operations.

New lines of business or new services may subject us to additional risks.

From time to time, we may implement new lines of business or offer new services within existing lines of business. There are substantial risks and uncertainties associated with these efforts, particularly in instances where the markets are not fully developed. In developing and marketing new lines of business and/or new services, we may invest significant time and resources. Initial timetables for the introduction and development of new lines of business and/or new services may not be achieved and profitability targets may not prove feasible. External factors, such as compliance with regulations, competition and shifting market preferences, may also impact the successful implementation of a new line of business or a new service. Our personnel and technology systems may fail to adapt to the changes in such new areas or we may fail to effectively integrate new services into our existing operations and we may lack experience in managing new lines of business or new services. In addition, we may be unable to proceed with our operations as planned or compete effectively due to different competitive landscapes in these new areas. Even if we expand our businesses into new jurisdictions or areas, the expansion may not yield intended profitable results. Furthermore, any

new line of business and/or new service could have a significant impact on the effectiveness of our internal control system. Failure to successfully manage these risks in the development and implementation of new lines of business or new services could have a material adverse effect on our business, results of operations and financial condition.

Any failure to protect our intellectual property could harm our business and competitive position.

We, through our Hong Kong subsidiaries, own and maintain a number of registered domain names (including our website) and, although we do not currently own any registered trademarks other than our company logo, registered in Hong Kong, we may in the future acquire new intellectual property such as trademarks, copyrights, domain names, and know-how. We will rely on a combination of intellectual property laws and contractual arrangements to protect our intellectual property rights. It is possible that third parties may copy or otherwise obtain and use our trademarks without authorization or otherwise infringe on our rights or illegitimately disguise as us. We may not be able to successfully pursue claims for infringement that interfere with our ability to use our trademarks, website, or other relevant intellectual property or have adverse impact on our brand. We cannot assure you that any of our intellectual property rights would not be challenged, invalidated, or circumvented, or such intellectual property will be sufficient to provide us with competitive advantages. In addition, other parties may misappropriate our intellectual property rights, which would cause us to suffer economic or reputational damages.

We may face intellectual property infringement claims, which could be time-consuming and costly to defend and may result in the loss of significant rights by us.

Although we have not been subject to any litigation, pending or threatened, alleging infringement of third parties’ intellectual property rights, we cannot assure you that such infringement claims will not be asserted against us in the future. Third parties may own copyrights, trademarks, trade secrets, ticker symbols, internet content, and other intellectual properties that are similar to ours in jurisdictions where we currently have no active operations. If we expand our business to or engage in other commercial activities in those jurisdictions using our own copyrights, trademarks, trade secrets, and internet content, we may not be able to use these intellectual properties or face potential lawsuits from those third parties and incur substantial losses if we fail to defend ourselves in those lawsuits. We have policies and procedures in place to reduce the likelihood that we or our employees may use, develop, or make available any content or applications without the proper licenses or necessary third-party consents. However, these policies and procedures may not be effective in completely preventing the unauthorized posting or use of copyrighted material or the infringement of other rights of third parties.

Intellectual property litigation is expensive and time-consuming and could divert resources and management attention from the operation of our business. If there is a successful claim of infringement, we may be required to alter our services, cease certain activities, pay substantial royalties and damages to, and obtain one or more licenses from third parties. We may not be able to obtain those licenses on commercially acceptable terms, or at all. Any of those consequences could cause us to lose revenues, impair our client relationships and harm our reputation.

Our business is subject to various cyber-security risks and other operational risks, such as the failure or malfunction of our information technology infrastructure and the failure to maintaining relationships with our vendors, which may cause disruptions to our business operation and tarnish our reputation.

As a financial services company, our Operating Subsidiary faces various cyber-security and other operational risks relating to our businesses on a daily basis. Their operations depend upon the secured processing, storage and transmission of confidential and other information in their information technology infrastructure and they are vulnerable to unauthorized access such as cyber-attacks, distributed denial of service attacks and ransomware attacks, malicious code and computer viruses by activists, hackers, organized crime, foreign state actors and other third parties, or other events that could lead to a security breach. They may also be subject to cyber-attacks involving the leak and destruction of sensitive and confidential client information and our proprietary information, which could result from an employee’s or agent’s failure to follow data security procedures or as a result of actions by third parties, including actions by government authorities. As the breadth and complexity of our information technology infrastructure continue to grow, the potential risk of security breaches and cyber-attacks increases. Developing and enhancing new products and services, which is necessary for us to remain competitive, may involve the use or creation of new technologies, which further exposes us to cybersecurity and privacy risks that cannot be completely anticipated and increase the risk of security breaches and cyber-attacks.

While we have adopted various means to safeguard the integrity of our computer system and information technology infrastructure, these systems and infrastructure may fail to operate properly or become disabled as a result of events which are beyond our control, events such as human error, natural disasters, power failures, client misuse, computer viruses, cyber-attacks, spam attacks, unauthorized access and data loss or leakage. All of which may cause shutdown or disruption of operations (including data loss or corruption, interruption to our data storage system, delay or cessation in the services provided through our securities dealing and brokerage system and our online trading platform), account takeovers and unauthorized gathering, monitoring, misuse, loss, total destruction and disclosure of data and confidential information of ours, our clients, our employees or other third parties, or otherwise materially disrupt our or our clients’ or other third parties’ network access or business operations. The occurrence of one or more of such events could jeopardize the confidentiality of information processed, stored and transmitted through our computer systems and networks or otherwise disrupt our operations, which could result in reputational damage, disputes with clients and relevant parties, and financial losses.

Our Operating Subsidiary also depends on various third-party software and platforms as well as other information technology systems provided by our information technology vendor in our business operations. These systems, including third-party systems, may fail to operate properly or become disabled as a result of tampering or a breach of our network security systems or otherwise, including for reasons beyond our control. Any interruption or deterioration in the performance of these third parties or failures of their information systems and technology could impair our operations, affect our reputation, and adversely affect our businesses. There is no guarantee that we are able to maintain our existing relationship with the information technology vendor of our software system or information technology infrastructure. In the event that any vendor is unable or unwilling to continue to provide existing services to our Operating Subsidiary, our Operating Subsidiary may not be able to replace them with service providers of equivalent expertise in a timely manner and thus resulting in disruption to our business operations.

The occurrence of any disruption to our computer system and/or other information technology infrastructure may render us unable to meet client requirements in a timely and efficient manner, and/or lead to unauthorized disclosure of personal information or any other unexpected associated losses and damages. As a result, our reputation may be tarnished and we may also face complaints, disciplinary action by regulatory authorities, and legal proceedings being brought against us (which can be costly and time-consuming to defend and which may significantly divert the efforts and resources of our management personnel away from our usual business operations) and may potentially result in us having to pay damages. This could materially and adversely affect our financial condition, prospects, and results of operations.

Failure to comply with data privacy, data protection, or any other laws and regulations related to data privacy and security, or the failure to protect client data or prevent breaches of our information systems, could expose us to liability or reputational damage and materially and adversely affect our business, financial condition, and results of operations.

As a financial services company, in providing our services to clients, we manage, utilize and store sensitive and confidential client data, including personal data. As a result, we may be subject to a variety of data privacy, data protection, cybersecurity, and other laws and regulations related to data, including those relating to the collection, use, sharing, retention, security, disclosure, and transfer of confidential and private information, such as personal information and other data. These laws and regulations may apply not only to third-party transactions, but also to transfers of information within our organization, which relates to our investors, employees, contractors and other counterparties. These laws and regulations may restrict our business activities and require us to incur increased costs and efforts to comply, and any breach or noncompliance may subject us to proceedings against us, damage our reputation, or result in penalties and other significant legal liabilities, and thus may materially and adversely affect our business, financial condition, and results of operations.

If any person, including any of our employees, negligently disregards or intentionally breaches our established controls with respect to client data, or otherwise mismanages or misappropriates that data, we could be subject to significant monetary damages, regulatory enforcement actions, fines and/or criminal prosecution. Unauthorized disclosure of sensitive or confidential client data, whether through systems failure, employee negligence, fraud or misappropriation, could damage our reputation and cause us to lose clients. In addition, vulnerabilities of our external service providers and other third parties could also pose security risks to client information and data. Although we have taken steps to reduce the risk of such threats, our risk and exposure to a cyber-attack or related breach remains heightened due to the evolving nature of these threats, our routine transmission of sensitive information to third parties, the current global

economic and political environment, external extremist parties and other developing factors. Similarly, unauthorized access to or through our information systems, whether by our employees or third parties, including a cyber-attack by third parties who may deploy viruses, worms or other malicious software programs, could result in negative publicity, significant remediation costs, legal liability, regulatory fines, and damage to our reputation and could have adverse effects on our results of operations. Any actual or perceived breach of the security of our technology, or media reports of perceived security vulnerabilities of our systems or the systems of our third-party service providers, could damage our reputation, expose us to the risk of litigation and liability, disrupt our operations, increase our costs with respect to investigations and remediation, reduce our revenues as a result of the theft of intellectual property, and otherwise adversely affect our business. Further, any actual or perceived security breach or cyber-attack directed at other financial institutions or financial services companies, whether or not we are impacted, could lead to a general loss of client confidence in the use of technology to conduct financial transactions, which could negatively impact us. The occurrence of any of these events could have adverse effects on our business and results of operations.

Risks Relating to Our Corporate Structure

We rely on dividends and other distributions on equity paid by our subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our subsidiaries to make payments to us could have a material adverse effect on our ability to conduct our business.

Vittoria is a holding company, and we rely on dividends and other distributions on equity paid by our subsidiaries for our cash and financing requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders and service any debt we may incur. If any of our subsidiaries incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us.

Subject to the BVI Act and our Amended and Restated Memorandum and Articles of Association, our board of directors may, by resolution of directors, authorize and declare a dividend to shareholders at such time and of such an amount as they think fit if they are satisfied, on reasonable grounds, that immediately following the dividend the value of our assets will exceed our liabilities and we will be able to pay our debts as they become due. There is no further BVI statutory restriction on the amount of funds which may be distributed by us by dividend. Under Hong Kong law, dividends could only be paid out of distributable profits (that is, accumulated realized profits less accumulated realized losses) or other distributable reserves. Dividends cannot be paid out of share capital. Under the current practice of the Inland Revenue Department of Hong Kong, no withholding tax is payable in Hong Kong in respect of dividends paid by our Hong Kong subsidiaries to us.

Any limitation on the ability of our Hong Kong subsidiaries to pay dividends or make other distributions to us could materially and adversely limit our ability to grow, make investments or acquisitions that could be beneficial to our business, pay dividends, or otherwise fund and conduct our business.

Investors may have difficulty enforcing judgments against us, our directors and management. Investors may incur additional costs and procedural obstacles in effecting service of legal process, enforcing foreign judgments or bringing actions in BVI or Hong Kong against us or our management named in the prospectus based on BVI or Hong Kong laws.

We are incorporated under the laws of the BVI. We conduct our operations outside the United States and substantially all of our assets are located outside the United States. In addition, all of our directors and officers are Hong Kong nationals or residents and a substantial portion of their assets are located in Hong Kong outside the United States. As a result, it may be difficult or impossible to effect service of process within the U.S. upon these persons, or to recover against us or them on judgments of U.S. courts, including judgments predicated upon the civil liability provisions of the U.S. federal securities laws. Even if you are successful in bringing an action of this kind, the laws of the BVI or Hong Kong could render you unable to enforce a judgment against our assets or the assets of our directors and officers.

There is uncertainty as to whether the courts of the BVI would (i) recognize or enforce judgments of U.S. courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the U.S. or any state in the U.S. or (ii) entertain original actions brought in the BVI against us or our directors or officers predicated upon the securities laws of the U.S. or any state in the U.S.

The U.S. and the BVI do not have a treating providing for reciprocal recognition and enforcement of judgments of courts of the U.S. in civil and commercial matters and that a final judgment for the payment of money rendered by any general or state court in the U.S. based on civil liability, whether or not predicated solely upon the U.S. federal securities laws would not be enforceable in the BVI. A final and conclusive judgment obtained in U.S. federal or state courts under which a sum of money is payable as compensatory damages (i.e., not being a sum claimed by a revenue authority for taxes or other charges of a similar nature by a governmental authority, or in respect of a fine or penalty or multiple or punitive damages) may be the subject of an action on a debt in the court of the BVI under the common law doctrine of obligation. Furthermore, it is uncertain that BVI courts would: (i) recognize or enforce judgments of U.S. courts obtained in actions against us or our directors or officers predicated upon the civil liability provisions of the U.S. federal securities laws; or (ii) entertain original actions brought against us or other persons predicated upon the Securities Act.

There is also uncertainty as to whether the courts of Hong Kong would (i) recognize or enforce judgments of the U.S. courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the U.S. or any state in the U.S. or (ii) entertain original actions brought in Hong Kong against us or our directors or officers predicated upon the securities laws of the U.S. or any state in the U.S.

A judgment of a court in the U.S. predicated upon U.S. federal or state securities laws may be enforced in Hong Kong at common law by bringing an action in a Hong Kong court on that judgment for the amount due thereunder, and then seeking summary judgment on the strength of the foreign judgment, provided that the foreign judgment, among other things, is (i) for a debt or a definite sum of money (not being taxes or similar charges to a foreign government taxing authority or a fine or other penalty) and (ii) final and conclusive on the merits of the claim, but not otherwise. Such a judgment may not, in any event, be so enforced in Hong Kong if (a) it was obtained by fraud; (b) the proceedings in which the judgment was obtained were opposed to natural justice; (c) its enforcement or recognition would be contrary to the public policy of Hong Kong; (d) the court of the U.S. was not jurisdictionally competent; or (e) the judgment was in conflict with a prior Hong Kong judgment.

Hong Kong has no arrangement for the reciprocal enforcement of judgments with the U.S. As a result, there is uncertainty as to the enforceability in Hong Kong, in original actions or in actions for enforcement, of judgments of the U.S. courts of civil liabilities predicated solely upon the federal securities laws of the U.S. or the securities laws of any State or territory within the U.S. You may incur additional costs and procedural obstacles in effecting service of legal process, enforcing foreign judgments or bringing actions in Hong Kong against us or our management named in the prospectus, as judgments entered in the U.S. can be enforced in Hong Kong only at common law. For more information regarding the relevant laws of the BVI and Hong Kong, see “Enforcement of Liabilities.”

You may have more difficulty protecting your interests than you would as a shareholder of a U.S. corporation.

Our corporate affairs are governed by the provisions of our memorandum and articles of association, as amended and restated from time to time, and by the provisions of applicable BVI law. The rights of shareholders and the fiduciary responsibilities of our directors and officers under BVI law are not as clearly established as they would be under statutes or judicial precedents in some jurisdictions in the U.S., and some states (such as Delaware) have more fully developed and judicially interpreted bodies of corporate law.

These rights and responsibilities are to a large extent governed by the BVI Business Companies Act, 2004 as amended from time to time and the common law of the BVI. The common law of the BVI is derived in part from judicial precedent in the BVI as well as from English common law, which has persuasive, but not binding, authority on a court in the BVI. In addition, BVI law does not make a distinction between public and private companies and some of the protections and safeguards (such as statutory pre-emption rights, save to the extent expressly provided for in the memorandum and articles of association) that investors may expect to find in relation to a public company are not provided for under BVI law.

There may be less publicly available information about us than is regularly published by or about U.S. issuers. Also, the BVI regulations governing the securities of BVI companies may not be as extensive as those in effect in the U.S., and the BVI law and regulations regarding corporate governance matters may not be as protective of minority shareholders as state corporation laws in the U.S. Therefore, you may have more difficulty protecting your interests in connection with actions taken by our directors and officers or our principal shareholders than you would as a shareholder of a corporation incorporated in the U.S.

The laws of BVI provide limited protections for minority shareholders, so minority shareholders will not have the same options as to recourse in comparison to the U.S if the shareholders are dissatisfied with the conduct of our affairs.

Under the laws of the BVI there is limited statutory protection of minority shareholders other than the provisions of the BVI Act dealing with shareholder remedies. The principal protections under BVI statutory law are derivative actions, actions brought by one or more shareholders for relief from unfair prejudice, oppression and unfair discrimination and/or to enforce the BVI Act or the memorandum and articles of association. Shareholders are entitled to have the affairs of the company conducted in accordance with the BVI Act and the memorandum and articles of association, and are entitled to payment of the fair value of their respective shares upon dissenting from certain enumerated corporate transactions.

There are common law rights for the protection of shareholders that may be invoked, largely dependent on English company law, since the common law of the BVI is limited. Under the general rule pursuant to English company law known as the rule in Foss v. Harbottle, a court will generally refuse to interfere with the management of a company at the insistence of a minority of its shareholders who express dissatisfaction with the conduct of the company’s affairs by the majority or the board of directors. However, every shareholder is entitled to seek to have the affairs of the company conducted properly according to law and the constitutional documents of the company. As such, if those who control the company have persistently disregarded the requirements of company law or the provisions of the company’s memorandum and articles of association, then the courts may grant relief. Generally, the areas in which the courts will intervene are the following: (i) an act complained of which is outside the scope of the authorized business or is illegal or not capable of ratification by the majority; (ii) where the company has not complied with provisions requiring approval of a special or extraordinary majority of shareholders; (iii) acts that infringe or are about to infringe on the personal rights of the shareholders, such as the right to vote; or (iv) acts that constitute fraud on the minority where the wrongdoers control the company.

These rights may be more limited than the rights afforded to minority shareholders under the laws of states in the United States.

Other than as set forth in the BVI Act, shareholders of BVI companies like us have no general rights under BVI law to inspect corporate records or to obtain copies of lists of shareholders of these companies. Our directors have discretion to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders, other than as set forth in the BVI Act. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

As a result of all of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of the board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States.

Risks Relating to Our Class A Ordinary Shares and This Offering

Our Class A Ordinary Shares may be prohibited from being traded on a national exchange under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect our auditors. The delisting of our Class A Ordinary Shares, or the threat of their being delisted, may materially and adversely affect the value of your investment. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, which was signed into law on December 29, 2022, amending the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three.

The Holding Foreign Companies Accountable Act, or the HFCAA, was enacted on December 18, 2020. The HFCAA states if the SEC determines that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit our shares from being traded on a national securities exchange or in the over-the-counter trading market in the United States.

On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCA Act. A company will be required to comply with these rules if the SEC identifies it as having a “non-inspection” year under a process to be subsequently established by the SEC. The SEC

is assessing how to implement other requirements of the HFCA Act, including the listing and trading prohibition requirements described above. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the “AHFCAA”), which was signed into law on December 29, 2022, amending the HFCAA and requiring the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchange if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years. On September 22, 2021, the PCAOB adopted a final rule implementing the HFCAA, which provides a framework for the PCAOB to use when determining, as contemplated under the HFCAA, whether the PCAOB is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction. On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions. On December 16, 2021, the PCAOB issued a Determination Report which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (i) China, and (ii) Hong Kong.

On August 26, 2022, the PCAOB announced and signed a Statement of Protocol (the “Protocol”) with the China Securities Regulatory Commission and the Ministry of Finance of the PRC. The Protocol provides the PCAOB with: (i) sole discretion to select the firms, audit engagements and potential violations it inspects and investigates, without any involvement of Chinese authorities; (ii) procedures for PCAOB inspectors and investigators to view complete audit work papers with all information included and for the PCAOB to retain information as needed; (iii) direct access to interview and take testimony from all personnel associated with the audits the PCAOB inspects or investigates.

On December 15, 2022, the PCAOB issued a new Determination Report which: (i) vacated the December 16, 2021 Determination Report; and (ii) concluded that the PCAOB has been able to conduct inspections and investigations completely in the PRC in 2022. The December 15, 2022 Determination Report cautions, however, that authorities in the PRC might take positions at any time that would prevent the PCAOB from continuing to inspect or investigate completely. As required by the HFCAA, if in the future the PCAOB determines it no longer can inspect or investigate completely because of a position taken by an authority in the PRC, the PCAOB will act expeditiously to consider whether it should issue a new determination.

Our auditor, WWC, P.C., the independent registered public accounting firm that issues the audit report included elsewhere in this prospectus, as a firm headquartered in California and registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess our auditor’s compliance with the applicable professional standards with the last inspection in November 2021, and as of the date of this prospectus, our auditor is not subject to and not affected by to the PCAOB’s December 2021 Determination Report. However, in the event it is later determined that the PCAOB is unable to inspect or investigate completely the auditor because of a position taken by an authority in a foreign jurisdiction, such as the PRC authorities, then such lack of inspection could cause trading in the Company’s securities to be prohibited under the HFCAA, and ultimately result in a determination by a securities exchange to delist the Company’s securities.

The SEC may propose additional rules or guidance that could impact us if our auditor is not subject to PCAOB inspection. For example, on August 6, 2020, the President’s Working Group on Financial Markets, or the PWG, issued the Report on Protecting United States Investors from Significant Risks from Chinese Companies to the then President of the United States. This report recommended the SEC implement five recommendations to address companies from jurisdictions that do not provide the PCAOB with sufficient access to fulfil its statutory mandate. Some of the concepts of these recommendations were implemented with the enactment of the HFCA Act. However, some of the recommendations were more stringent than the HFCA Act. For example, if a company’s auditor was not subject to PCAOB inspection, the report recommended that the transition period before a company would be delisted would end on January 1, 2022.

The SEC has announced that the SEC staff is preparing a consolidated proposal for the rules regarding the implementation of the HFCA Act and to address the recommendations in the PWG report. It is unclear when the SEC will complete its rulemaking and when such rules will become effective and what, if any, of the PWG recommendations will be adopted. The implications of this possible regulation in addition to the requirements of the HFCA Act are uncertain. Such uncertainty could cause the market price of our Class A Ordinary Shares to be materially and adversely affected, and our securities could be delisted or prohibited from being traded on the national securities exchange earlier

than would be required by the HFCA Act. If our Class A Ordinary Shares are unable to be listed on another securities exchange by then, such a delisting would substantially impair your ability to sell or purchase our Class A Ordinary Shares when you wish to do so, and the risk and uncertainty associated with a potential delisting would have a negative impact on the price of our Class A Ordinary Shares.

Further, new laws and regulations or changes in laws and regulations in both the United States and the PRC could affect our ability to list our Class A Ordinary Shares, which could materially impair the market for and market price of our Class A Ordinary Shares.

There has been no public market for our Class A Ordinary Shares prior to this Offering, and you may not be able to resell our Class A Ordinary Shares at or above the price you paid, or at all.

Prior to this Offering, there has been no public market for our Class A Ordinary Shares. Although we have applied to have our Class A Ordinary Shares listed on the Nasdaq Capital Market, we cannot assure you that a liquid public market for our Class A Ordinary Shares will develop. If an active public market for our Class A Ordinary Shares does not develop following the completion of this Offering, the market price of our Class A Ordinary Shares may decline and the liquidity of our Class A Ordinary Shares may decrease significantly.

The initial public offering price for our Class A Ordinary Shares will be determined by negotiation between us, the Selling Shareholders and the Underwriters and may vary from the market price of our Class A Ordinary Shares following our initial public offering. We cannot assure you that the price at which the Class A Ordinary Shares are traded after this Offering will not decline below the initial public offering price. If you purchase our Class A Ordinary Shares in our initial public offering, you may not be able to resell those shares at or above the initial public offering price. We cannot assure you that the initial public offering price of our Class A Ordinary Shares, or the market price following our initial public offering, will equal or exceed prices in privately negotiated transactions of our shares that have occurred from time to time prior to our initial public offering. As a result, investors in our Class A Ordinary Shares may experience a significant decrease in the value of their Class A Ordinary Shares due to insufficient or a lack of market liquidity of our Class A Ordinary Shares.

We may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Class A Ordinary Shares.

The trading prices of our Class A Ordinary Shares are likely to be highly volatile and could fluctuate widely due to factors beyond our control. This may happen due to broad market and industry factors, such as performance and fluctuation in the market prices or underperformance or deteriorating financial results of other listed companies based in Hong Kong and China. The securities of some of these companies have experienced significant volatility since their initial public offerings, including, in some cases, substantial price declines in the trading prices of their securities. The trading performances of other Hong Kong and Chinese companies’ securities after their offerings may affect the attitudes of investors towards Hong Kong-based U.S.–listed companies, which consequently may affect the trading performance of our Class A Ordinary Shares, regardless of our actual operating performance. In addition, any negative news or perceptions about inadequate corporate governance practices or fraudulent accounting, corporate structure or matters of other Hong Kong and Mainland Chinese companies may also negatively affect the attitudes of investors towards Hong Kong and Mainland Chinese companies in general, including us, regardless of whether we have conducted any inappropriate activities. Furthermore, securities markets may from time to time experience significant price and volume fluctuations that are not related to our operating performance, which may have a material and adverse effect on the trading price of our Class A Ordinary Shares.

In addition to the above factors, the price and trading volume of our Class A Ordinary Shares may be highly volatile due to multiple factors, including the following:

•        regulatory developments affecting us or our industry;

•        variations in our revenues, profit, and cash flow;

•        the general market reactions and financial market fluctuation due to the continuous Russo-Ukraine conflicts;

•        changes in the economic performance or market valuations of other financial services firms; political, social and economic conditions in Mainland China and Hong Kong;

•        actual or anticipated fluctuations in our quarterly results of operations and changes or revisions of our expected results;

•        fluctuations of exchange rates among Hong Kong dollar, Renminbi, and the U.S. dollar;

•        changes in financial estimates by securities research analysts;

•        detrimental negative publicity about us, our services, our officers, directors, Controlling Shareholder, other beneficial owners, professional parties we partner with, or our industry;

•        announcements by us or our competitors of new service offerings, acquisitions, strategic relationships, joint ventures, capital raisings or capital commitments;

•        additions to or departures of our senior management;

•        litigation or regulatory proceedings involving us, our officers, directors, or Controlling Shareholder;

•        release or expiry of lock-up or other transfer restrictions on our outstanding Class A Ordinary Shares; and

•        sales or perceived potential sales of additional Class A Ordinary Shares.

Any of these factors may result in large and sudden changes in the volume and price at which our Class A Ordinary Shares will trade.

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. As a relatively small-capitalization company with relatively small public float, we may experience greater stock price volatility, extreme price run-ups, lower trading volume and less liquidity than large-capitalization companies. In particular, our Class A Ordinary Shares 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-run up, may be unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Class A Ordinary Shares.

In addition, if the trading volumes of our Class A Ordinary Shares are low, persons buying or selling in relatively small quantities may easily influence prices of our Class A Ordinary Shares. This low volume of trades could also cause the price of our Class A Ordinary Shares to fluctuate greatly, with large percentage changes in price occurring in any trading day session. Holders of our Class A Ordinary Shares may also not be able to readily liquidate their investment or may be forced to sell at depressed prices due to low volume trading. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of our Class A Ordinary Shares. As a result of this volatility, investors may experience losses on their investment in our Class A Ordinary Shares. A decline in the market price of our Class A Ordinary Shares also could adversely affect our ability to issue additional shares of Class A Ordinary Shares or other securities and our ability to obtain additional financing in the future. No assurance can be given that an active market in our Class A Ordinary Shares will develop or be sustained. If an active market does not develop, holders of our Class A Ordinary Shares may be unable to readily sell the shares they hold or may not be able to sell their shares at all.

In the past, shareholders of public companies have often brought securities class action suits against those companies following periods of instability in the market price of their securities. If we were involved in a class action suit, it could divert a significant amount of our management’s attention and other resources from our business and operations and require us to incur significant expenses to defend the suit, which could harm our results of operations. Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.

Our Class A Ordinary Shares may be thinly traded and you may be unable to sell at or near ask prices or at all if you need to sell your shares to raise money or otherwise desire to liquidate your shares.

Assuming our Class A Ordinary Shares begin trading on the Nasdaq Capital Market, our Class A Ordinary Shares may be “thinly-traded,” meaning that the number of persons interested in purchasing our Class A Ordinary Shares at or near bid prices at any given time may be relatively small or non-existent. This situation may be attributable to a number of factors, including the fact that we are relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if we come to the attention of such persons, they tend to be risk-averse and might be reluctant to follow an unproven company such as ours or purchase or recommend the purchase of our shares until such time as we became more seasoned. As a consequence, there may be periods of several days or more when trading activity in our shares is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price. A broad or active public trading market for our Class A Ordinary Shares may not develop or be sustained.

We have broad discretion in the use of the net proceeds from this Offering and may not use them effectively.

Our management will have broad discretion in the application of the net proceeds, including for any of the purposes described in the section entitled “Use of Proceeds,” and you will not have the opportunity as part of your investment decision to assess whether the net proceeds are being used appropriately. Because of the number and variability of factors that will determine our use of the net proceeds from this Offering, their ultimate use may vary substantially from their currently intended use. The failure by our management to apply these funds effectively could harm our business.

The sale or availability for sale of substantial amounts of our ordinary shares could adversely affect their market price.

Sales of substantial amounts of our Class A Ordinary Shares in the public market after the completion of this offering, or the perception that these sales could occur, could adversely affect the market price of our Class A Ordinary Shares and could materially impair our ability to raise capital through equity offerings in the future. Resales of our Ordinary Shares in the public market during this offering by the Selling Shareholders in this offering may cause the market price of our Ordinary Shares to decline. The Class A Ordinary Shares to be offered by us and all of the Class A Ordinary Shares offered by the Selling Shareholders will be freely tradable without restriction or further registration under the Securities Act. Because these Selling Shareholders have paid a discounted price per Class A Ordinary Share than participants in this Offering, when they are to sell their pre-offering shares, they may be more willing to accept a lower sales price than the Offering Price. This fact could impact the trading price of our Class A Ordinary Shares following completion of the Offering, to the detriment of participants in this Offering.

Furthermore, Class A Ordinary Shares held by our existing shareholder, Victory Amaze Limited, may also be sold in the public market in the future, subject to the restrictions in Rule 144 and Rule 701 under the Securities Act and the applicable lock-up agreements. Sale of these Ordinary Shares into the market could cause the market price of our Ordinary Shares to decline.

There may be substantial sales of our Class A Ordinary Shares by the Selling Shareholders after the effective date of this registration statement of which this prospectus forms a part, which could have a material adverse effect on the price of our Class A Ordinary Shares after this offering.

The registration statement of which this prospectus forms a part also registers on behalf of the Selling Shareholders an aggregate of 2,000,000 Class A Ordinary Shares previously issued by us. There are currently no agreements or understandings in place with the Selling Shareholders to restrict the sale of the Class A Ordinary Shares to be offered by the Selling Shareholders after the effective date of the registration statement of which this prospectus forms a part. Sales of a substantial number of our Class A Ordinary Shares by the Selling Shareholders at such time could cause the market price of our Ordinary Shares to decrease (possibly below the initial public offering price of the Class A Ordinary Shares in this offering) and could impair our ability to raise capital in the future by selling additional Company securities.

You will experience immediate and substantial dilution in the net tangible book value of Class A Ordinary Shares purchased.

The Offering Price of our Class A Ordinary Shares is substantially higher than the (pro forma) net tangible book value per share of our Class A Ordinary Shares. Consequently, when you purchase our Class A Ordinary Shares in the Offering and upon completion of the Offering, you will incur immediate dilution of $3.04 per share, assuming an Offering Price of $4 (the proposed minimum offering price). See “Dilution.” In addition, you may experience further dilution to the extent that additional Class A Ordinary Shares are issued upon exercise of outstanding options we may grant from time to time.

If we fail to meet applicable listing requirements, Nasdaq may delist our Class A Ordinary Shares from trading, in which case the liquidity and market price of our Class A Ordinary Shares could decline.

Assuming our shares are listed on Nasdaq, we cannot assure you that we will be able to meet the continued listing standards of Nasdaq in the future. If we fail to comply with the applicable listing standards and Nasdaq delists our Class A Ordinary Shares, we and our shareholders could face significant material adverse consequences, including:

•        a limited availability of market quotations for our Class A Ordinary Shares;

•        reduced liquidity for our Class A Ordinary Shares;

•        a determination that our Class A Ordinary Shares are “penny stock”, which would require brokers trading in our Class A Ordinary Shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our Class A Ordinary Shares;

•        a limited amount of news about us and analyst coverage of us; and

•        a decreased ability for us to issue additional equity securities or obtain additional equity or debt financing in the future.

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because we expect that our shares will be listed on Nasdaq, such securities will be covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Further, if we were no longer listed on Nasdaq, our securities would not be covered securities and we would be subject to regulations in each state in which we offer our securities.

The dual-class structure of our ordinary shares will have the effect of concentrating voting control with our Controlling Shareholder, Victory Amaze, which will hold in the aggregate 84.85% of the voting power of our voting shares following the completion of this Offering, preventing you and other shareholders from influencing significant decisions, including the election of directors, amendments to our organizational documents and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring shareholder approval.

Our authorized and issued ordinary shares are divided into Class A Ordinary Shares and Class B Ordinary Shares.

As of the date of this prospectus, there are currently 4,250,000 Class A ordinary shares and 1,250,000 Class B ordinary shares issued and outstanding. Holders of Class A Ordinary Shares and Class B Ordinary Shares shall at all times vote together as one class on all matters submitted to a vote by the shareholders. Each Class A Ordinary Share has one (1) vote and each Class B Ordinary Share has fifteen (15) votes. Each Class B Ordinary Share is convertible into one (1) Class A Ordinary Share at any time at the option of the holder thereof. Class A Ordinary Shares are not convertible into Class B Ordinary Shares under any circumstances.

The Class B Ordinary Shares outstanding are beneficially owned by Mr. On Tai, LAM (the chairman of our board of directors and Chief Executive Officer) and Mr. Chi Fung Leo, CHAN (our director and Chief Financial Officer), through Victory Amaze Limited, representing 81.5% of the aggregate voting power of our currently outstanding ordinary shares as of the date hereof. Upon the completion of this offering, Mr. Lam and Mr. Chan, through Victory Amaze Limited, will hold 84.85% of the aggregate voting power, assuming that the underwriters do not exercise its over-allotment option, and assuming that Selling Shareholders will sell all of the 2,000,000 Class A Ordinary Shares

they offered for sale pursuant to the Resale Prospectus. Because of the fifteen-to-one voting ratio between our Class B and Class A Ordinary Shares, Mr. Lam and Mr. Chan, through Victory Amaze Limited, will continue to control a majority of the combined voting power of our ordinary shares and therefore be able to control all matters submitted to our shareholders for approval so long as the Class B Ordinary Shares represent at least 51% of the voting power of all outstanding ordinary shares. This concentrated control will limit the ability of holders of Class A Ordinary Shares to influence corporate matters for the foreseeable future. Furthermore, should the Company decide to issue additional Class B Ordinary Shares in the future, the fifteen-to-one voting ratio between the two classes of our ordinary shares will result in further dilutive effect on the holders of Class A Ordinary Shares.

As a result, for so long as Victory Amaze Limited owns a controlling or significant voting interest in our ordinary shares, it generally will be able to control or significantly influence, directly or indirectly and subject to applicable law, all matters affecting us, including:

•        the election of directors;

•        determinations with respect to our business direction and policies, including the appointment and removal of officers;

•        determinations with respect to corporate transactions, such as mergers, business combinations, change in control transactions or the acquisition or the disposition of assets;

•        our financing and dividend policy;

•        determinations with respect to our tax returns; and

•        compensation and benefits programs and other human resources policy decisions.

Even if Victory Amaze Limited were to dispose of certain of its shares of our Class B Ordinary Shares such that it would control less than a majority of the voting power of our outstanding ordinary shares, it may be able to influence the outcome of corporate actions so long as it retains Class B Ordinary Shares. During the period of Victory Amaze Limited’s controlling or significant ownership of our ordinary shares, investors in this offering may not be able to affect the outcome of such corporate actions.

Victory Amaze Limited may have interests that differ from yours and may vote in a way with which you disagree, and which may be adverse to your interests. Corporate action might be taken even if other shareholders, including those who purchase shares in this offering, oppose them. This concentration of ownership may have the effect of delaying, preventing or deterring a change of control or other liquidity event of our Company, could deprive our shareholders of an opportunity to receive a premium for their shares of Class A Ordinary Shares as part of a sale or other liquidity event and might ultimately affect the market price of our ordinary shares.

Furthermore, we cannot predict whether our dual-class structure will result in a lower or more volatile market price of our Class A Ordinary Shares or in adverse publicity or other adverse consequences. For example, certain index providers have announced restrictions on including companies with multiple-class share structures in certain of their indexes. In July 2017, FTSE Russell and S&P Dow Jones announced that they would cease to allow most newly public companies utilizing dual-class capital structures to be included in their indices. Affected indices include the Russell 2000 and the S&P 500, S&P MidCap 400 and S&P SmallCap 600, which together make up the S&P Composite 1500. Beginning in 2017, MSCI, a leading stock index provider, opened public consultations on their treatment of dual-class structures and temporarily barred new dual-class listings from certain of its indices; however, in October 2018, MSCI announced its decision to include equity securities “with unequal voting structures” in its indices and to launch a new index that specifically includes voting rights in its eligibility criteria. Under the announced policies, our dual-class capital structure makes us ineligible for inclusion in certain indices, and as a result, mutual funds, exchange-traded funds and other investment vehicles that attempt to passively track those indices are not expected to invest in our stock. These policies are still fairly new and it is as of yet unclear what effect, if any, they will have on the valuations of publicly traded companies excluded from the indices, but it is possible that they may depress these valuations compared to those of other similar companies that are included. Because of our multi-class structure, we will likely be excluded from certain of these indexes and we cannot assure you that other stock indexes will not take similar actions. Given the sustained flow of investment funds into passive strategies that seek to track certain indexes, exclusion from stock indexes would likely preclude investment by many of these funds and could make our Class A Ordinary Shares less attractive to other investors. As a result, the market price of our Class A Ordinary Shares could be adversely affected.

As a “controlled company” under the rules of the Nasdaq Capital Market, we may choose to exempt our Company from certain corporate governance requirements that could have an adverse effect on our public shareholders

Our directors and officers beneficially own a majority of the voting power of our issued and outstanding ordinary shares. Under the Rule 4350(c) of the Nasdaq Capital Market, a company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including the requirement that a majority of our directors be independent, as defined in the Nasdaq Capital Market Rules, and the requirement that our compensation and nominating and corporate governance committees consist entirely of independent directors. Although we do not intend to rely on the “controlled company” exemption under the Nasdaq listing rules, we could elect to rely on this exemption in the future. If we elect to rely on the “controlled company” exemption, a majority of the members of our Board of Directors might not be independent directors and our nominating and corporate governance and compensation committees might not consist entirely of independent directors. Accordingly, during any time while we remain a controlled company relying on the exemption and during any transition period following a time when we are no longer a controlled company, you would not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq Capital Market corporate governance requirements. Our status as a controlled company could cause our Class A Ordinary Share to look less attractive to certain investors or otherwise harm our trading price.

Future issuances of our Class B Ordinary Shares may be dilutive to the voting power of our Class A Ordinary Shareholders

Future issuances of our Class B Ordinary Shares, which can be approved by our Board of Directors, could result in dilution to existing holders of our Class A Ordinary Shares. Such issuances, or the perception that such issuances may occur, could depress the market price of the Class A Ordinary Shares. In addition, there might be impact of the conversion of Class B Ordinary Shares on holders of Class A Ordinary Shares, including dilution and the reduction in aggregate voting power, as well as the potential increase in the relative voting power if any Class B holder retains their shares.

If securities or industry analysts do not publish or publish inaccurate or unfavorable research about our business, or if they adversely change their recommendations regarding our Class A Ordinary Shares, the market price for our Class A Ordinary Shares and trading volume could decline.

The trading market for our Class A Ordinary Shares will depend in part on the research and reports that securities or industry analysts publish about us or our business. If research analysts do not establish and maintain adequate research coverage or if one or more of the analysts who covers us downgrades our Class A Ordinary Shares or publishes inaccurate or unfavorable research about our business, the market price for our Class A Ordinary Shares would likely decline. If one or more of these analysts cease coverage of the Company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which, in turn, could cause the market price or trading volume for our Class A Ordinary Shares to decline.

Shares eligible for future sale may adversely affect the market price of our ordinary shares, as the future sale of a substantial amount of outstanding ordinary shares in the public marketplace could reduce the price of our ordinary shares.

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 ordinary shares. shares will be outstanding immediately after this offering if the firm commitment is completed and the underwriters do not exercise their over-allotment option and shares if exercised in full. All of the shares sold in the offering will be freely transferable without restriction or further registration under the Securities Act. The remaining shares will be “restricted securities” as defined in Rule 144. 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.

Because the amount, timing, and whether or not we distribute dividends at all is entirely at the discretion of our board of directors, you must rely on price appreciation of our Class A Ordinary Shares for return on your investment.

Our board of directors has complete discretion as to whether to distribute dividends. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our board of directors. In either case, all dividends are subject to certain restrictions under the BVI law, namely the Company may only pay dividends if we are solvent immediately after the dividend payment in the sense that the value of our assets will exceed our liabilities and we will be able to pay our debts as they become due.

We currently intend to retain all remaining funds and future earnings, if any, for the operation and expansion of our business and do not anticipate declaring or paying any further dividends in the foreseeable future. Any future determination related to our dividend policy will be made at the discretion of our board of directors after considering our financial condition, results of operations, capital requirements, contractual requirements, business prospects and other factors the board of directors deems relevant, and will be subject to the restrictions contained in any future financing instruments.

Even if our board of directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors. Accordingly, the return on your investment in our Class A Ordinary Shares will likely depend entirely upon any future price appreciation of our Class A Ordinary Shares. We cannot assure you that our Class A Ordinary Shares will appreciate in value after this Offering or even maintain the price at which you purchased the Class A Ordinary Shares. You may not realize a return on your investment in our Class A Ordinary Shares and you may even lose your entire investment in our Class A Ordinary Shares. See “Dividend Policy” section for more information.

We are a “foreign private issuer” and a British Virgin Islands company, and our disclosure obligations differ from those of U.S. domestic reporting companies. As a result, we may not provide you the same information as U.S. domestic reporting companies or we may provide information at different times, which may make it more difficult for you to evaluate our performance and prospects.

We are a foreign private issuer and, as a result, we are not subject to the same requirements as U.S. domestic issuers. Under the Exchange Act, we will be subject to reporting obligations that, to some extent, are more lenient and less frequent than those of U.S. domestic reporting companies. For example, we will not be required to issue quarterly reports or proxy statements. In addition, we will not be required to disclose detailed individual executive compensation information. Furthermore, our directors and executive officers will not be required to report equity holdings under Section 16 of the Exchange Act and will not be subject to the insider short swing profit disclosure and recovery regime.

As a foreign private issuer, we will also be exempt from the requirements of Regulation FD (Fair Disclosure) which, generally, are meant to ensure that select groups of investors are not privy to specific information about an issuer before other investors. However, we will still be subject to the anti-fraud and anti-manipulation rules of the SEC, such as Rule 10b-5 under the Exchange Act. Since many of the disclosure obligations imposed on us as a foreign private issuer differ from those imposed on U.S. domestic reporting companies, you should not expect to receive the same information about us and at the same time as the information provided by U.S. domestic reporting companies.

The information we are required to file with or furnish to the SEC will be less extensive and less timely as compared to that required to be filed with the SEC by U.S. domestic issuers.

As a British Virgin Islands company listed on the Nasdaq Capital Market, we are subject to the Nasdaq Capital Market corporate governance listing standards. However, Nasdaq Capital Market rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in the British Virgin Islands, which is deemed our home country, may differ significantly from the Nasdaq Capital Market corporate governance listing standards. For example:

•        our independent directors do not need to hold regularly scheduled meetings in executive session (rather, all board members may attend all meetings of the board of directors);

•        the compensation of our executive officers is recommended but not determined by an independent committee of the board or by the independent members of the board of directors; and our Chief Executive Officer is not prevented from being present in the deliberations concerning his compensation;

•        related party transactions are not required to be reviewed and we are not required to solicit member approval of stock plans, including: those in which our officers or directors may participate; share issuances that will result in a change in control; the issuance of our shares in related party acquisitions or other acquisitions in which we may issue 20% or more of our issued and outstanding shares; or below market issuances of 20% or more of our issued and outstanding shares to any person; and

•        we are not required to hold an in-person annual meeting to elect directors and transact other business customarily conducted at an annual meeting (rather, we complete these actions by written consent of holders of a majority of our voting securities).

Although we do not currently plan to utilize the home country exemption for corporate governance matters, to the extent that we choose to do so in the future, our shareholders may be afforded less protection than they otherwise would under the Nasdaq Capital Market corporate governance listing standards applicable to U.S. domestic issuers. As a result, you may not be afforded the same protections or information which would be made available to you if you were investing in a U.S. domestic issuer.

There can be no assurance that we will not be a passive foreign investment company, or PFIC, for United States federal income tax purposes for any taxable year, which could subject United States investors in our Class A Ordinary Shares to significant adverse United States income tax consequences.

We will be classified as a passive foreign investment company, or PFIC, for any taxable year if either (i) 75% or more of our gross income for such year consists of certain types of “passive” income, or (ii) 50% or more of the value of our assets (determined on the basis of a quarterly average) during such year produce or are held for the production of passive income (the “asset test”). Based upon our current and expected income and assets, including goodwill and (taking into account the expected proceeds from this Offering) the value of the assets held by our strategic investment business, the expected proceeds from this Offering as well as projections as to the market price of our Class A Ordinary Shares immediately following the completion of this Offering, we do not presently expect to be classified as a PFIC for the current taxable year or the foreseeable future.

While we do not expect to be a PFIC, because the value of our assets, for purposes of the asset test, may be determined by reference to the market price of our Class A Ordinary Shares, fluctuations in the market price of our Class A Ordinary Shares may cause us to become a PFIC classification for the current or subsequent taxable years. The determination of whether we will be or become a PFIC will also depend, in part, on the composition and classification of our income, including the relative amounts of income generated by and the value of assets of our strategic investment business as compared to our other businesses. Because there are uncertainties in the application of the relevant rules, it is possible that the U.S. Internal Revenue Service, or IRS, may challenge our classification of certain income and assets as non-passive which may result in our being or becoming a PFIC in the current or subsequent years. In addition, the composition of our income and assets will also be affected by how, and how quickly, we use our liquid assets and the cash raised in this Offering. If we determine not to deploy significant amounts of cash for active purposes, our risk of being a PFIC may substantially increase. Because there are uncertainties in the application of the relevant rules and PFIC status is a factual determination made annually after the close of each taxable year, there can be no assurance that we will not be a PFIC for the current taxable year or any future taxable year.

If we are a PFIC in any taxable year, a U.S. Holder (as defined in “Taxation — United States Federal Income Tax Considerations”) may incur significantly increased United States income tax on gain recognized on the sale or other disposition of our Class A Ordinary Shares and on the receipt of distributions on our Class A Ordinary Shares to the extent such gain or distribution is treated as an “excess distribution” under the United States federal income tax rules, and such holder may be subject to burdensome reporting requirements. Further, if we are a PFIC for any year during which a U.S. Holder holds our Class A Ordinary Shares, we will generally continue to be treated as a PFIC for all succeeding years during which such U.S. Holder holds our Class A Ordinary Shares. For more information see “Taxation — United States Federal Income Tax Considerations — Passive Foreign Investment Company Rules”.

We will incur increased costs as a result of being a public company, particularly after we cease to qualify as an emerging growth company.

Upon completion of this Offering, we will become a public company and expect to incur significant legal, accounting and other expenses that we did not incur as a private company. The Sarbanes-Oxley Act of 2002 and the rules subsequently implemented by the SEC and the New York Stock Exchange detailed requirements concerning corporate governance practices of public companies. As a company with less than US$1.235 billion in net revenues for our last fiscal year, we qualify as an “emerging growth company” pursuant to the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2012 relating to internal controls over financial reporting.

We expect these rules and regulations to increase our legal and financial compliance costs and to make some corporate activities more time-consuming and costly. After we are no longer an “emerging growth company,” we expect to incur significant expenses and devote substantial management effort toward ensuring compliance with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and the other time and attention to our public company reporting obligations and other compliance matters. For example, as a result of becoming a public company, we will need to increase the number of independent directors and adopt policies regarding internal controls and disclosure controls and procedures. We also expect that operating as a public company will make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. In addition, we will incur additional costs associated with our public company reporting requirements. It may also be more difficult for us to find qualified persons to serve on our board of directors or as executive officers. We are currently evaluating and monitoring developments with respect to these rules and regulations, and we cannot predict or estimate with any degree of certainty the amount of additional costs we may incur or the timing of such costs.

We are an “emerging growth company,” and the reduced disclosure requirements applicable to emerging growth companies may make our Class A Ordinary Shares less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act. For so long as we remain an emerging growth company, we are permitted and intend to rely on exemptions from certain disclosure requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include:

•        being permitted to provide only two years of audited financial statements, in addition to any required unaudited interim financial statements, with correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations” disclosure;

•        not being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting of Section 404(b) of the Sarbanes-Oxley Act;

•        not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements;

•        reduced disclosure obligations regarding executive compensation; and

•        exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

We have taken advantage of reduced reporting burdens in this prospectus. In particular, in this prospectus, we have only provided two years of audited financial statements and have not included all the executive compensation related information that would be required if we were not an emerging growth company. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing to take advantage of the extended transition period for complying with new or revised accounting standards.

We cannot predict whether investors will find our Class A Ordinary Shares less attractive if we rely on these exemptions. If some investors find our Class A Ordinary Shares less attractive as a result, there may be a less active trading market for our Class A Ordinary Shares and our share price may be more volatile.

We will remain an emerging growth company until the earliest of (i) the date on which we are deemed to be a “large accelerated filer” under the Securities Exchange Act of 1934, as amended, or the Exchange Act, which would occur if the market value of our Class A Ordinary Shares that are held by non-affiliates exceeds US$700 million as of the last business day of our most recently completed second fiscal quarter. (ii) the end of the fiscal year during which we have total annual gross revenues of US$1.235 billion or more, (iii) the date on which we have, during the preceding three-year period, issued more than US$1.0 billion in non-convertible debt, or (iv) the last day of our fiscal year following the fifth anniversary of the completion of this Offering.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this prospectus. This discussion and analysis and other parts of this prospectus contain forward-looking statements based upon current beliefs, plans and expectations that involve risks, uncertainties and assumptions. Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set forth under “Risk Factors” and elsewhere in this prospectus. You should carefully read the “Risk Factors” section of this prospectus to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements.

Overview

Commencing operation since October 2017, we are a Hong Kong-based financial services provider principally engaged in the provision of corporate finance advisory services, through our indirect wholly-owned Operating Subsidiary, Red Solar, which is a licensed corporation under the SFO to conduct Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities in Hong Kong. Our corporate finance advisory services mainly comprise the following:

•        Listing sponsorship and securities related services:

(a)     Listing sponsorship services:    Being one of the 127 active licensed sponsors in Hong Kong licensed under the SFO as of May 1, 2023 who are qualified to provide listing sponsorship services in Hong Kong, we act as sponsors to companies pursuing listing on the Main Board and GEM, advising and guiding them and their directors throughout the listing process, and performing all duties of a sponsor as required under applicable rules and regulations, in return for the sponsor’s fee. We recognized our listing sponsorship services fee as our revenue when the performance obligation under our contracts is satisfied.

(b)    Securities related services:    Pertinent to our listing sponsorship services, we also provide securities related services, including: (i) underwriting and placing services, principally as “sponsor-overall coordinator”, for listing applicants who we provide listing sponsorship service, pursuant to the Sponsor Coupling requirement by the Hong Kong Stock Exchange, in return for underwriting or placing commissions and/or fees; and (ii) other ancillary services, such as referral services to the underwriting, placing and other fund-raising exercises conducted by other underwriters, placing agents, financial institutions, in return for referral commissions and/or fees.

•        Financial and compliance advisory services:    We also provide financial and compliance advisory services under our Type 6 (advising on corporate finance) license, in return for a fixed or monthly advisory fee. By acting as:

(a)     financial advisers (i) to listed companies in Hong Kong as well as their shareholders and investors advising them on the terms and structures of proposed transactions, and the relevant implications of the Hong Kong regulatory framework, which primarily included the Main Board Listing Rules, GEM Listing Rules, and Takeovers Codes, in relation to the transactions; and (ii) to clients pursuing listing on other stock exchanges;

(b)    independent financial advisers to the independent board committee and independent shareholders of listed companies in Hong Kong rendering recommendations and opinions; and/or

(c)     compliance advisers to listed companies in Hong Kong and advise them on post-listing compliance matters.

We aspire to provide an integrated full-service platform for our clients with integrated financial services tailored to their varying needs. To cope with the evolving needs of our clients, in addition to our existing services, we endeavor to expand our financial market expertise and provide new types of financial services as demanded by our clients. Going forward, we plan to expand our corporate finance advisory service coverage internationally; in particular, to strengthen our financial advisory services to cater to the increase of demand from our clients’ network who desire to pursue listing in the U.S. capital market or other international capital markets, and to expand our international network and coverage to develop our corporate finance advisory services.

Since the commencement of our corporate finance advisory business in October 2017, we have actively participated in the equity capital market in Hong Kong. Our clients comprise both smaller and larger private and listed companies from a spectrum of industry sectors, based in Hong Kong, countries in Southeast Asia, and Mainland China. The market capitalization of our listed clients ranged approximately from around HK$100 million to over HK$20 billion.

For the years ended June 30, 2023 and 2022, we were engaged in three and five listing sponsorship projects and 13 and 18 financial and compliance advisory projects, respectively. As we only have commenced the securities related services in August 2022, we were not engaged in any underwriting, placing, or other securities related projects during the year ended June 30, 2022 but we were engaged in one securities related project during the year ended June 30, 2023. For the years ended June 30, 2023 and 2021, our total revenue was approximately US$677,685 and US$679,482, respectively, of which approximately US$102,076 and US$237,031, or approximately 15.0% and 34.9%, respectively, was generated from our listing sponsorship services; approximately US$306,229 and nil, or 45.2% and nil, respectively, was generated from our securities related services; and approximately US$269,380 and US$442,451, or approximately 39.8% and 65.1%, respectively, was generated from our financial and compliance advisory services.

Key Factors Affecting our Results of Operations

Our results of operations have been and will continue to be affected by a number of factors, including those set out below:

Market conditions of capital and financial market in Hong Kong

All our business operations were carried out in Hong Kong, and as the financial service provider for the capital market sectors of Hong Kong. Our results of operations and prospects are highly susceptible to any development of change in government policies, as well as economic, social, political and legal development in Hong Kong. In addition, the capital market and the economic conditions in general of Hong Kong are highly sensitive to conditions of the capital markets, political, social and economic conditions in Mainland China and globally. When there are unfavorable changes to the global or local conditions, such as the Covid-19 pandemic, Russo — Ukraine war, the outcome of the Sino — US trade dispute, terrorism, political uncertainty, civil unrest, control of foreign exchange, changes in exchange rates, rising interest rates or inflation, slowing or negative growth rate, government involvement in the allocation of resources, events with adverse impacts on investors’ confidence and risk appetites, such as local riots or mass civil disobedience movements, or any regulatory reform of governments, global or local financial markets and economic conditions could be negatively impacted or may experience negative fluctuations in its performance beyond our control. Any prolonged slowdown in the global, Mainland China or Hong Kong economy may affect market confidence in the capital market as a whole and have a negative impact on our business as a whole, the demand for corporate finance advisory services, our pricing strategies, the level of our business activities and consequently our revenue derived therefrom. This may materially and adversely affect our financial condition and the results of operations.

Competition in the corporate finance services industry in Hong Kong

The financial and securities services industry in Hong Kong is highly competitive due to the vast number of market players in providing corporate finance advisory services similar to ours. Our competitors may have longer operating history, better brand recognition and reputation, proven track record, operations in more geographic locations, stronger human and financial resources, wider range of services and stronger shareholders’ background than us. We expect that there will be more market players entering into the market and competition will be intensified. New participants may enter into the market insofar as they have engaged appropriate qualified professionals and obtained the requisite regulatory licenses and permits. Given the keen competition, we cannot assure that we will be able to maintain our competitive edge in response to the fast-changing business environment. In addition, competition creates an unfavorable pricing environment in the market in which we operate. Intensified competition may cause us to reduce our service fees in order to compete with other market players, which could place significant pressure on our ability to maintain gross margins and is particularly acute during market slowdowns, and will in turn materially and adversely affect our market share, financial condition and results of operations.

Our ability to manage our staff costs

Our staff costs are the largest cost we incur in our business operations and our ability to manage our staff costs affects our results of operations. Our staff costs amounted to approximately US$309,291 and US$544,234 for the years ended June 30, 2023 and 2022, respectively. Our staff costs and employee benefits consist primarily of salaries, bonuses and mandatory provident fund contribution. Any upward changes in the staff costs would impact our results of operations negatively.

Rules and regulatory requirements governing by relevant regulatory authorities or government agencies in Hong Kong

The Hong Kong financial market and corporate finance services industry in which we primarily operate are highly regulated. Our business operations are subject to applicable laws, regulations, guidelines, circulars, and other regulatory guidance, and many aspects of our businesses depend on obtaining and maintaining approvals, licenses, permits, or qualifications from the relevant regulators. Serious non-compliance with regulatory requirements could result in investigations and regulatory actions, which may lead to penalties, including reprimands, fines, limitations, or prohibitions on our future business activities or, if significant, suspension or revocation of our licenses. Failure to comply with these regulatory requirements could limit the scope of businesses in which we are permitted to engage. Furthermore, additional regulatory approvals, licenses, permits, or qualifications may be required by relevant regulators in the future, and some of our current approvals, licenses, permits, or qualifications are subject to periodic renewal. Although we have not been found by any relevant regulators to be in material non-compliance with any regulatory requirements since we commenced our businesses in 2017, any such finding or other negative outcome may affect our ability to conduct business, harm our reputation and, consequently, materially and adversely affect our business, financial condition, results of operations, and prospects.

Our Operating Subsidiary, Red Solar, is an HKSFC-licensed corporation that is subject to various requirements, such as remaining fit and proper at all times, minimum liquid and paid-up capital requirements, notification requirements, submission of audited accounts, submission of financial resources returns and annual returns, continuous professional training, under the SFO of Hong Kong and its subsidiary legislation and the codes and the guidelines issued by the HKSFC from time to time. If Red Solar fails to meet the regulatory capital requirements in Hong Kong, the local regulatory authorities may impose penalties on us or limit the scope of our business, which could, in turn, have a material adverse effect on our financial condition and the results of operations. Moreover, the relevant capital requirements may be changed over time or subject to different interpretations by relevant governmental authorities, all of which are out of our control. Any increase in the relevant capital requirements or stricter enforcement or interpretation of the same may adversely affect our business activities. Any non-compliance with applicable laws, regulations, guidance or codes or any negative findings made by the regulators may result in (i) fines, deterrent penalties, or disciplinary actions against us, our Responsible Officers, Licensed Representatives or any of our personnel; or (ii) suspension or revocation of some or all of (a) our registrations or licenses for carrying on our business activities; or (b) the approvals or licenses granted to our personnel enabling them to carry out their responsibilities in our Group. For instance, conditions may be imposed on our licenses restricting us from carrying on our business, or our Responsible Officers or Licensed Representatives may be banned from the industry for a specific period of time. Accordingly, our business operation, reputation, financial condition, and results of operations might be materially and adversely affected.

Rules and regulations governing listed companies on the Stock Exchange

During the years ended June 30, 2023 and 2022 and up to the date of this prospectus, we provided corporate finance advisory services to clients who are listing applicants or listed companies or their shareholders or investors on the Stock Exchange. These clients are required to comply with the Main Board Listing Rules, the GEM Listing Rules, the Takeovers Code and other rules and regulations where applicable. Any changes to such rules and regulations, particularly those affecting the appointment and the role of the sponsors in listing applications and the appointment and the role of financial adviser in specific transactions, may affect the demand for and the scope of our corporate finance advisory services which may in turn materially and adversely affect our results of operations.

Impact of the outbreak of the coronavirus (COVID-19) on our business and operations

Since early 2020, the ongoing COVID-19 pandemic has led governments across the globe to impose a series of measures intended to contain its spread, including border closures, travel bans, quarantine measures, social distancing, and restrictions on business operations and large gatherings, and has caused significant disruption to worldwide economic activities, including economic activities in Hong Kong (where we operate in), and in Southeast Asia and the Mainland China (where a significant portion of our client and potential client locate).

The COVID-19 pandemic outbreak in Hong Kong in early 2020 and early 2022 resulted in temporary pandemic-related lockdowns. These two outbreaks of COVID-19 domestically in Hong Kong caused companies such as ours, as well as our business partners and clients, to implement temporary adjustments to work schedules and travel plans and to implement alternative work arrangements for some of our or their employee to work from home and collaborate remotely. As a result, we have experienced lower efficiency and productivity, internally and externally, which may adversely affect our service quality. Since April 2022, in light of the reduced severity of the COVID-19 pandemic in Hong Kong, our alternative work arrangement was largely abolished. Nonetheless, as our business depends on our employees, if any of our employees has contracted or is suspected of having contracted COVID-19, these employees will be required to be quarantined and they could pass it to other of our employees, potentially resulting in severe disruption to our business.

At the date of the prospectus, most countries around the globe have abolished the measures to contain COVID-19 pandemic and went “back to normal.” Hong Kong’s government has significantly lessened its entry restrictions, quarantines, and pandemic control measures. However, the PRC government still maintains travel restrictions, and regional lock-down and quarantine requirements in response to COVID-19. These measures severely hinder our client development efforts in Mainland China, and our businesses and clients have been adversely affected by travel restrictions preventing PRC residents from traveling to Hong Kong.

Furthermore, our results of operations have been affected by the COVID-19 outbreak. We witnessed huge market fluctuations in the global capital and financial markets since 2020. Due to the instability of global financial markets and other economic and financial challenges brought about by COVID-19, the deterioration of the economic condition of Mainland China due to the continuous COVID-19 control measures, the significant market volatility and declines in general economic activities in Hong Kong and globally, have severely dampened the confidence of our client in the global and Hong Kong’s financial markets and their willingness to conduct fundraising activities in Hong Kong Stock Exchanges, especially through IPO. The pandemic, government measures in response to the pandemic, and the global economic deterioration, could result in an economic downturn in Hong Kong and countries where our clients and potential client locates and in the foreseeable future. Such a downturn in global and Hong Kong’s economy may lead our client to adopt the conservative business strategies instead of seeking for expansion, ultimately led to a decline in our clients’ fund raising needs and therefore our corporate services, especially our listing sponsorship and securities related services. All of which could adversely affect our business and, in turn, negatively impact our business and the results of operations.

Given the general slowdown in economic conditions globally, volatility in the capital markets as well as the generally negative impact of the COVID-19 outbreak on the capital market markets, we cannot assure you that we will be able to maintain the growth rate we have experienced or projected. Any future impact on our results of operations will depend on, to a large extent, future developments and new information that may emerge regarding the duration and severity of the COVID-19 pandemic and the actions taken by government authorities and other entities to contain the spread or treat its impact, almost all of which are beyond our control. We will continue to closely monitor the situation throughout 2023 and beyond.

Listing sponsorship services

Our revenue from listing sponsorship services decreased by approximately US$134,955 or 56.9% from approximately US$237,031 for the year ended June 30, 2022 to approximately US$102,076 for the year ended June 30, 2023. The decrease in revenue from our listing sponsorship services for the year ended June 30, 2023 was mainly attributable to a decreased number of listing sponsorship projects we were engaged in for the year.

For the year ended June 30, 2022, we had five listing sponsorship projects of which three were initial listing projects and two were transfer of listing from GEM to the Main Board projects, with contract sum ranging from approximately US$140,938 to US$640,626 and an aggregate contract sum of approximately US$1,979,533, representing an average of 3.5% of respective proposed fundraising by our listing sponsorship clients excluding aggregate contract sum from the two transfer of listing projects of approximately US$499,688, which did not involve fund-raising. During the year, we recorded revenue of approximately US$237,031 in aggregate from two listing sponsorship projects, with contract sum of approximately US$326,719 and US$640,626, respectively, and an aggregate contract sum of approximately US$967,345, and the revenue recognized in aggregate represented approximately 24.5% of the aggregate contract sum of those two projects. One of them was a Main Board listing sponsorship project with revenue recognized of approximately US$128,125, representing approximately 20.0% of the respective contract sum, upon lapse of its contract as the client decided not to proceed its initial listing plan due to unfavorable market conditions during the year. The other one was a GEM listing sponsorship project with revenue recognized of approximately US$108,906, representing approximately 33.3% of the respective contract sum, upon lapse of its contract. No revenue was recognized for the remaining three listing sponsorship projects since no listing project was completed during the year.

For the year ended June 30, 2023, we had three listing sponsorship projects, with contract sum ranging from approximately US$421,065 to US$510,382 and an aggregate contract sum of approximately US$1,358,891, representing an average of 3.3% of respective proposed fundraising by our listing sponsorship clients. During the year, we recorded revenue of approximately US$102,076 in aggregate from two listing sponsorship projects, with contract sum of approximately US$427,445 and US$510,382, respectively, and an aggregate contract sum of approximately US$937,827, and the revenue recognized in aggregate represented approximately 10.9% of the aggregate contract sum of those two projects. One of them was a Main Board listing sponsorship project with revenue recognized of approximately US$63,797, representing approximately 12.5% of the respective contract sum, upon lapse of its contract. The other one was a GEM listing sponsorship project with revenue recognized of approximately US$38,279, representing approximately 9.0% of the respective contract sum, upon lapse of its contract. Due to unfavorable market conditions during the year, the clients of these two listing projects decided not to proceed its initial listing plan after lapse of contract. No revenue was recognized for the remaining listing sponsorship project since no milestone was completed regarding that project during the year.

In addition, for the year ended June 30, 2022, our revenue from listing sponsorship services was all generated from Malaysian-based clients who are a construction contractor and a manufacturer, respectively, amounting to approximately US$237,031 or 100.0% of total revenue from listing sponsorship services for the year. During the year ended June 30, 2023, we recorded revenue of approximately US$38,279, or 37.5% of total revenue from listing sponsorship services for the year, from a Malaysian-based client who is a manufacturer and recorded revenue of approximately US$63,797, or 62.5% of total revenue from listing sponsorship services for the year, from a PRC-based client engaged in the provision of advertisement and marketing solutions.

For the years ended June 30, 2023 and 2022, we completed nil listing sponsorship projects. Our Directors considered that the decrease in our revenue from listing sponsorship services between the year ended June 30, 2023 and 2022 was attributable to the unfavorable market conditions. According to annual statistics of the Hong Kong Stock Exchange, total equity funds raised dropped from approximately US$99 billion for the year ended December 31, 2021 to approximately US$32 billion for the year ended December 31, 2022, and the number of newly listed companies decreased from 98 for the year ended December 31, 2021 to 90 for the year ended December 31, 2022, among which the number of companies newly listed on the Main Board decreased from 97 to 90, and the number of companies newly listed on GEM decreased from 1 to nil for the respective years. The numbers of newly listed companies on the Main Board and GEM, in aggregate, for the years ended December 31, 2021 and 2022, respectively, are the lowest among the numbers for each of the year from 2013 to 2022, being a time period of approximately a decade. It could also be attributable to the ongoing COVID-19 pandemics which resulted in difficulties and lengthened time for us in conducting due diligence and business development work during the periods and hindered our completion of listing sponsorship projects.

Securities related services

Our revenue from securities related services increased from nil to approximately US$306,229 for the years ended June 30, 2022 and 2023, respectively. As we only have commenced our securities related services in August 2022, we were not engaged in any underwriting, placing, or other securities related projects during the year ended June 30, 2022. For the year ended June 30, 2023, we participated in one placing exercise by providing referral services to the issuer listed in Stock Exchange and its placing agent for its fund-raising exercise, introducing investors in return for referral commission. We recorded revenue of approximately US$306,229 from the placing exercise, in which we referred investors to subscribe the new shares issued by a Hong Kong listed company in its fund-raising exercise with a total subscription amount of approximately US$30.6 million in return for a fixed 1.0% referral commission of approximately US$306,229, which was recognized at the point of completion of such placing exercise.

Financial and compliance advisory services

Our revenue from financial and compliance advisory services decreased by approximately US$173,071, or 39.1%, from approximately US$442,451 for the year ended June 30, 2022 to approximately US$269,380 for the year ended June 30, 2023, primarily due to the increase in revenue derived from our independent financial advisory services being offset by the decreases in revenue derived from our financial advisory services and compliance advisory services.

Financial advisory services

Our revenue from financial advisory services decreased by US$128,864, or 84.5%, from approximately US$152,469 for the year ended June 30, 2022 to approximately US$23,605 for the year ended June 30, 2023. The contract period of our financial advisory projects was generally within two years after signing the contract. Revenue of our financial advisory services was mainly derived from clients based in Hong Kong during the years ended June 30, 2023 and 2022.

For the year ended June 30, 2022, we recorded financial advisory fees of approximately US$152,469 in aggregate as revenue for four financial advisory projects with contract sum ranging from approximately US$8,969 to approximately US$128,125 and the aggregate contract sum of the four projects was approximately US$246,000, which was fixed with no variable fees. One of these projects was completed during the year with revenue recognized of approximately US$8,969 while the other three with contract sum ranging from approximately US$19,219 to US$128,125 were lapsed with revenue recognized of approximately US$143,500 in aggregate for the upfront payment upon contract expiry as the clients decided not to proceed with their intended fundraising or merger and acquisition activity due to unfavorable market conditions during the year.

For the year ended June 30, 2023, we recorded financial advisory fees of approximately US$23,605 in aggregate as revenue for two financial advisory projects with contract sum of approximately US$34,451 and approximately US$12,760, respectively, which were fixed with no variable fees, and the aggregate contract sum of the two projects were approximately US$47,211. The project with a contract sum of approximately US$34,451 had revenue recognized during the year of approximately US$17,225 for upfront payment, while the other with a contract sum of approximately US$12,760 were lapsed during the year with revenue recognized of approximately US$6,380 for the upfront payment upon contract expiry as the clients decided not to proceed with their intended fundraising or merger and acquisition activity due to unfavorable market conditions during the year.

As illustrated above, we had fewer financial advisory projects with generally lower contract sum, and therefore recognized less revenue from financial advisory services, for the year ended June 30, 2023, when compared with the preceding year.

Independent financial advisory services

Our revenue from independent financial advisory services increased by US$1,774, or 5.2%, from approximately US$33,953 for the year ended June 30, 2022 to approximately US$35,727 for the year ended June 30, 2023. The contract period of our independent financial advisory services projects was generally within one year after signing the contract. Revenue of independent financial advisory projects was derived from Hong Kong listed companies during the years ended June 30, 2023 and 2022.

For the year ended June 30, 2022, we recorded independent financial advisory fees of approximately US$33,953 in aggregate as revenue for three independent financial advisory projects, which are completed during the year, with contract sum ranging from approximately US$6,406 to approximately US$16,016 and the aggregate contract sum of the three projects was approximately US$33,953, which was fixed with no variable fees.

For the year ended June 30, 2023, we recorded independent financial advisory fees of approximately US$35,727 in aggregate as revenue for three independent financial advisory projects, which are completed during the year, with contract sum ranging from approximately US$11,484 to approximately US$12,760 and the aggregate contract sum of the three projects was approximately US$35,727, which was fixed with no variable fees.

As there was no obvious improvement in the market condition during the years, the number of our independent financial advisory projects completed remained unchanged for the year ended June 30, 2023 and 2022. The range of contract sums of our independent financial advisory projects was smaller, and the aggregate contract sum was higher, for the year ended June 30, 2023 when compared with the preceding year. As we completed all our independent financial advisory projects during the year ended June 30, 2023, the higher aggregate contract sum was entirely recognized as our revenue from independent financial advisory services during for the year, leading to the increase in our revenue therefrom when compared with the preceding year.

Compliance advisory services

We generally charge our clients fixed monthly fees which are payable on monthly or quarterly basis for providing compliance advisory services. Our revenue from compliance advisory services decreased by approximately US$45,981, or 18.0%, from approximately US$256,029 for the year ended June 30, 2022 to approximately US$210,048 for the year ended June 30, 2023. We completed three compliance advisory projects during the year ended June 30, 2022, and we commenced two new compliance advisory projects during the year ended June 30, 2023. We generally provide compliance advisory services to our clients for a period upon their successful initial listing on the Stock Exchange and until they have published their financial results for the first or second full financial years commencing after the date of initial listing, which were generally within 2 years. Our revenue from compliance advisory services were derived from listed companies in Hong Kong during the years ended June 30, 2023 and 2022.

For the year ended June 30, 2022, we recorded compliance advisory fees of approximately US$256,029 in aggregate as revenue for six compliance advisory projects with monthly compliance advisory fee of ranging from approximately US$3,844 to approximately US$5,766, which was fixed with no variable fees. The averaged monthly compliance advisory fee we charged for these six compliance advisory projects was approximately US$4,655 during the year.

For the year ended June 30, 2023, we recorded compliance advisory fees of approximately US$210,048 in aggregate as revenue for five compliance advisory projects with monthly compliance advisory fee of ranging from approximately US$3,828 to approximately US$4,466, which was fixed with no variable fees. The averaged monthly compliance advisory fee we charged for these five compliance advisory projects was approximately US$4,109 during the year.

The number of our engaged compliance advisory projects decreased from six to five for the year ended June 30, 2022 and 2023 respectively, which was in line with the decline in the number of newly listed companies in the Hong Kong Stock Exchange from 98 to 90 for the years ended December 31, 2021 and 2022, respectively. In view of the declining capital market activities, we attempted to maintain our competitiveness by offering lower compliance advisory service fees for our new projects engaged during the year ended June 30, 2023. In particular, the average monthly compliance advisory fee of the two new compliance advisory projects commenced during the year ended June 30, 2023 was approximately US$4,211, which was lower than the average monthly compliance advisory fee of approximately US$4,655 for the year ended June 30, 2022. On the other hand, three of our compliance advisory projects with relatively higher monthly fees ranging from approximately US$4,869 to US$5,766 were completed during the year ended June 30, 2022. As a combined result of the above, we observed a decrease in average monthly compliance advisory fee by approximately US$546, or 11.7%, from approximately US$4,655 for the year ended June 30, 2022 to approximately US$4,109 for the year ended June 30, 2023.

Operating expenses

The following table set forth the breakdown of our operating expenses for the periods indicated:

Our operating expenses mainly represented direct project costs of legal and information technology advisory fees incurred for rendering of FA services, staff costs and employee benefits, rental and office expenses of our Hong Kong office, legal and professional fees, depreciation charge and other expenses. Our operating expenses increased by approximately US$138,535, or 20.5%, from approximately US$676,572 for the year ended June 30, 2022 to approximately US$815,107 for the year ended June 30, 2023, which was mainly due to the increase in legal and professional fees for the year ended June 30, 2023 by approximately US$399,017.

We recorded direct project costs of approximately nil and US$25,625 for the years ended June 30, 2023 and 2022, respectively, as we are required to engage in independent professional parties as legal advisor and information technology advisor as stipulated in the service agreement and this is the only one arrangement with the client during the year ended June 30, 2022 while no such arrangement for the year ended June 30, 2023.

Our staff costs and employee benefits decreased by approximately US$234,943, or 43.2% from approximately US$544,234 for the year ended June 30, 2022 to approximately US$309,291 for the year ended June 30, 2023. The decrease in staff costs and employee benefits was mainly due to (i) the adjusted salary packages to our directors starting in February 2022 in light of the uncertain business outlook amid Covid-19 pandemics and declines in the general economic activities and financial market in Hong Kong, which has adjusted the directors’ salary packages by reducing their aggregate monthly director fees from approximately US$38,438 to approximately US$2,042 while other terms remained unchanged, which resulted in the decrease in the remuneration of directors by approximately US$254,641 from approximately US$280,363 for the year ended June 30, 2022 to approximately US$25,722 for the year ended June 30, 2023.

Our rental and office expenses remained relatively stable for the years ended June 30, 2023 and 2022, at approximately US$97,698 and US$94,913, respectively.

Our legal and professional fees increased by approximately US$399,017, or 14,265.9% from approximately US$2,797 for the year ended June 30, 2022 to approximately US$401,814 for the year ended June 30, 2023, which was mainly due to the increase in audit fee for our US listing of approximately US$391,139 during the year ended June 30, 2023.

Other income

Our other income mainly represented government subsidy and interest income. Our other income increased by approximately US$1,178 from approximately US$14,360 for the year ended June 30, 2022 to approximately US$15,538 for the year ended June 30, 2023, which was primarily due to the increase in interest income by approximately US$8,383 for the year ended June 30,2023, but partially offset by the decrease in government subsidy received pursuant to the Employment Support Scheme (“ESS”) under the Anti-epidemic Fund from the Hong Kong government by approximately US$7,205 from approximately US$14,350 to US$7,145 for the year ended June 30, 2022 and 2023, respectively.

In 2020, Red Solar successfully applied for funding support from the ESS under the Anti-epidemic Fund, set up by the Hong Kong Government, to provide financial support to enterprises to retain their employees who may otherwise be made redundant. The wage subsidies provided to eligible employers under ESS are capped at HK$9,000 (approximately US$1,200) per employee and disbursed in two tranches: (i) the first tranche of subsidies was used for paying wages of employees from June to August 2020; and (ii) the second tranche for paying wages of employees from May to July 2022. Employers participating in ESS were required to undertake and warrant that they would: (i) not implement redundancies during the subsidy period; and (ii) spend all the wage subsidies on paying wages to their employees. If an employer fails to use all the subsidies received to pay the wages of his/her employees, the Hong Kong Government will claw back the unspent balance of the subsidy. If the total number of employees on the payroll in any one month of the subsidy period is less than the “committed headcount of paid employees”, the employer will have to pay a penalty to the Hong Kong Government. As confirmed by the ESS, the post-funding audit of Red Solar’s application has been completed and Red Solar is not required to return any subsidy or pay any penalty to the Hong Kong Government. There was no unfulfilled conditions nor other contingencies attached to the ESS funding.

Income tax

We are subject to income tax on an entity basis on profit arising in or derived from the jurisdiction in which members of our Group domicile or operate.

British Virgin Islands

Under the current laws of the British Virgin Islands, we are not subject to tax on income or capital gains.

Hong Kong

According to the Inland Revenue (Amendment) (No. 3) Ordinance 2018, the two-tiered profits tax rates regime is introduced with effect from the year of assessment 2018/19. The profits tax rate for the first HK$2 million (approximately US$255,191) of assessable profits will be lowered to 8.25% for corporations and 7.5% for unincorporated businesses. Assessable profits above HK$2 million (approximately US$255,191) will continue to be subject to the rate of 16.5% for corporations and standard rate of 15% for unincorporated businesses.

Our income tax increased by approximately US$39,672, or 2,766.5%, from approximately US$1,434 for the year ended June 30, 2022 to approximately US$41,106 for the year ended June 30, 2023. Although the Group derived loss before income tax of approximately US$121,884 for the current year which was resulted from the operating loss generated from the Company which has no income, the Group’s operating subsidiary, Red Solar, was generating income before tax of US$278,325 for the year ended June 30, 2023 which was higher than that of approximately US$17,271 for the year ended June 30, 2022, resulted in an increase in income tax of the Group during the current year.

Net income

Our net income decreased by approximately US$178,826, or 1,129.2% from approximately US$15,836 for the year ended June 30, 2022 to a net loss of approximately US$162,990 for the year ended June 30, 2023, which was mainly due to the foregoing reasons as discussed above.

Liquidity and Capital Resources

The following table set forth our current assets and current liabilities as of the dates indicated:

Accounts Receivable

Our accounts receivable mainly represent amounts due from clients for corporate finance advisory services which are recorded net of allowance for the Group’s doubtful accounts. We generally grant credit terms of 5 days to our clients. In evaluating the collectability of receivable balances, we consider specific evidence including aging of the receivable, the client’s payment history, its current creditworthiness and current economic trends. We regularly review the adequacy and appropriateness of the allowance for doubtful accounts. Accounts receivable are written off after all collection efforts have ceased. As of June 30, 2023 and 2022, the allowance for doubtful accounts was nil and nil, respectively.

Our accounts receivable balance remained stable as of June 30, 2023 and 2022, which was approximately US$10,209 and US$10,195, respectively.

Deposits, prepayments and other receivables

Our deposits, prepayments and other receivables mainly represented rental deposit and prepayment of our staff reimbursement. The increase in deposits, prepayments and other receivables by approximately US$3,740, or 10.5%, from approximately US$35,671 as of June 30, 2022 to approximately US$39,411 as of June 30, 2023 was mainly due to the increase in prepaid staff reimbursement by approximately US$7,443.

Amounts due from directors

Our amounts due from directors were approximately nil and US$689,457 as of June 30, 2023 and 2022. The amounts due from directors of approximately US689,457 as of June 30, 2022 were fully settled during the year ended June 30, 2023, of which approximately US$203,827 was offset by the dividend declared on July 29, 2022 and the remaining had been subsequently settled by cash.

Accruals and other payables

Our accruals and other payables mainly represented our accrued legal and professional fee and accrued staff reimbursement. Our accruals and other payables increased by approximately US$208,073 from approximately US$6,965 as of June 30, 2022 to approximately US$215,038 as of June 30, 2023. The increase in accruals and other payables was mainly due to the increase in accrued legal and professional fee for our US listing of approximately US$209,959.

Contract liabilities

Our contract liabilities represented the upfront payments received upon signing of the mandate for our clients in relation to our listing sponsorship services and financial advisory service. These payments are non-refundable and are recognized as revenue when our performance obligation is satisfied or upon contract expiry. The increase in our contract liabilities by approximately US$38,390, or 50.2% from approximately US$76,460 as of June 30, 2022 to approximately US$114,850 as of June 30, 2023 was primarily due to the upfront payment of approximately US$51,044 received from one of our listing sponsorship projects and upfront payments of approximately US$57,425 received from two of our financial advisory projects in aggregate, which was partially offset by the upfront payment of approximately US$63,717 of a listing sponsorship project being recognized as revenue during the year ended June 30, 2023.

Lease liabilities

Our lease liabilities represented the current position of our non-cancellable lease contract of our Hong Kong office and were reduced by amortization charge and lease payments were made, respectively. Our current lease liabilities increased from approximately US$6,403 as of June 30, 2022 to approximately US$63,401 as of June 30, 2023, which was mainly due to the renewal of the lease agreement for our Hong Kong office during the year ended June 30, 2023.

Regulatory Capital Requirements

Subject to certain exemptions specified under FRR, as our indirect wholly-owned Hong Kong subsidiary, Red Solar is a company registered to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities with the HKSFC, an independent statutory body set up in accordance with the SFO, and Red Solar is required to maintain minimum paid-up share capital and minimum liquid capital in accordance with the FRR. The following table sets forth a summary of the requirements under the FRR that are applicable to Red Solar and its actual liquid capital as of June 30, 2023 and 2022, respectively:

The paid-up share capital is not defined under the SFO, but it generically refers to the actual paid-up share capital of a company by its shareholders. The liquid capital of a licensed corporation means the amount by which its liquid assets exceeds its ranking liabilities, as defined in accordance with the FRR. Liquid assets primarily represent our cash and cash equivalents, account receivables from our corporate finance advisory services and other assets including deposits, prepayments and other receivables, and the ranking liabilities primarily represent contract liabilities arise from our corporate finance advisory services, accruals and other payables. As of June 30, 2023 and 2022, Red Solar has exceeded the required regulatory capital requirement.

Cash Flows

Comparison of years ended June 30, 2023 and 2022

Our use of cash primarily related to operating activities and capital expenditure. We have historically financed our operations primarily through our cash flow generated from our operations. The following table sets forth a summary of our cash flows information for the years indicated:

Operating activities

Our cash inflow from operating activities was principally from the revenue from listing sponsorship services and securities related and financial and compliance advisory services, while our cash outflow used in operating activities principally consisted of payment of staff costs and employee benefits, rental and office expenses and other operating expenses.

Net cash generated from or used in operating activities reflects our net (loss) / profit adjusted for (i) non-cash item, namely depreciation charge of our property and equipment; and (ii) the effects of changes in operating assets and liabilities, which mainly comprised our accounts receivables, deposits, prepayments and other receivables and contract liabilities.

For the year ended June 30, 2022, our net cash used in operating activities was approximately US$190,372, comprising operating cash inflows before movements in working capital of approximately US$24,662 and net negative adjustment for change in operating assets and liabilities of approximately US$215,034. Net negative adjustments for change in operating assets and liabilities were primarily reflected by the decrease in contract liabilities of approximately US$226,781 which was mainly due to the upfront payment of approximately US$128,770 of a listing sponsorship project and the upfront payment of approximately US$103,016 of a financial advisory project being recognized as revenue during the year ended June 30, 2022 upon contract expiry, but partially offset by the decrease in deposits, prepayments and other receivables of approximately US$18,350.

For the year ended June 30, 2023, our net cash generated from operating activities was approximately US$134,528, comprising operating cash outflows before movements in working capital of approximately US$158,587 and net positive adjustment for change in operating assets and liabilities of approximately US$293,115. Net positive adjustments for change in operating assets and liabilities were primarily reflected by the increases in accruals and other payables of approximately US$208,038 which was mainly due to the increase in accrued legal and professional fee for our US listing of approximately US$209,959, decrease in deferred tax assets of approximately US$39,875 and increase in contract liabilities of approximately US$38,279.

Investing activity

Our cash used in investing activity was principally for the purchase of property and equipment.

For the year ended June 30, 2022, our cash used in investing activity of approximately US$1,500 was due to the purchase of property and equipment.

For the year ended June 30, 2023, we had nil cash from nor used in investing activity.

Financing activities

Our cash generated from financing activities was principally repayment from directors, being partially offset by payment of deferred offering costs.

For the year ended June 30, 2022, we had nil cash from nor used in financing activity.

For the year ended June 30, 2023, our cash from financing activities was approximately US$196,953, consisting of repayment from directors of approximately US$486,176 being partially offset by payment of deferred offering costs of approximately US$289,223.

Capital Expenditures

Our Group did not incurred any capital expenditure for the years ended June 30, 2023 and 2022.

Related Party Transaction and Balances

(a)    Related parties transactions

The Company does not have significant related party transactions incurred during the years ended June 30, 2023 and 2022 except for the following:

Remuneration to senior management for the years ended June 30, 2023 and 2022 were as follows:

(b)    Funds advance to related parties

As of June 30, 2022, our Group had funds advanced to our Directors of approximately US$689,457 for their personal investments purpose: (i) Mr. Lam of US$344,729; and (ii) Mr. Chan of US$344,728, respectively.

As of June 30, 2023, the amounts due from our Directors as of June 30, 2022 of approximately US$689,457 were fully settled, of which approximately US$203,827 was offset by the dividend declared on July 29, 2022 and the remaining had been subsequently settled by cash.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements, including arrangements that would affect its liquidity, capital resources, market risk support, and credit risk support or other benefits.

Quantitative and Qualitative Disclosure about Market Risk

Credit risk

Assets that potentially subject the Group to a significant concentration of credit risk primarily consist of cash and cash equivalents, accounts receivable, amounts due from directors and other current assets.

The Group believes that there is no significant credit risk associated with cash and cash equivalents, which were held by reputable financial institutions in the jurisdictions where the Company and its subsidiaries are located. The Hong Kong Deposit Protection Board pays compensation up to a limit of approximately US$63,806 if the bank with which an individual/a company hold its eligible deposit fails. As of June 30, 2023 and 2022, cash balance of approximately US$851,642 and US$520,711, respectively, was maintained at financial institutions in Hong Kong and approximately US$127,611 and US$89,255, respectively, were insured by the Hong Kong Deposit Protection Board.

The Group has designed their credit policies with an objective to minimize their exposure to credit risk. The Group’s accounts receivable are short term in nature and the associated risk is minimal. The Group conducts credit evaluations on its clients and generally does not require collateral or other security from such clients. The Group periodically evaluates the creditworthiness of the existing clients in determining an allowance for doubtful accounts primarily based upon the age of the receivables and factors surrounding the credit risk of specific clients.

Interest rate risk

The Group’s exposure on fair value interest rate risk mainly arises from its fixed deposits with bank. It also has exposure on cash flow interest rate risk which is mainly arising from its deposits with banks.

In respect of the exposure to cash flow interest rate risk arising from floating rate non-derivative financial instruments held by the Group, such as cash, at the end of the reporting period, the Group is not exposed to significant interest rate risk as the interest rates of cash at bank are not expected to change significantly.

Foreign currency risk

The reporting currency of the Company is U.S. Dollar. To date the majority of the revenues and costs are denominated in Hong Kong Dollar and a significant portion of the assets and liabilities are denominated in Hong Kong Dollars. There was no significant exposure to foreign exchange rate fluctuations and the Company has not maintained any hedging policy against foreign currency risk. The management will consider hedging significant currency exposure should the need arise.

Significant Accounting Policies and Critical Accounting Judgements and Estimates

We have identified certain accounting policies that are significant to the preparation of our Group’s financial information. Some of our accounting policies involve subjective assumptions and estimates, as well as complex judgements relating to accounting items. In each case, the determination of these items requires management judgements based on information and financial data that may change in future periods. When reviewing our financial information, you should consider: (i) our selection of accounting policies; and (ii) the results to changes in conditions and assumptions. We set forth below those accounting policies that we believe are of critical importance to us or involve the most significant estimates and judgements used in the preparation of our Group’s financial information.

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and, liabilities as at the date of the consolidated financial statements and reported amounts of income and expenses during the reporting periods. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Significant accounting estimates reflected in the Group’s consolidated financial statements include allowance for doubtful accounts, the useful lives of property and equipment, and interest rate of lease. Actual results may differ from these estimates.

Accounts receivable

Accounts receivable mainly represent amounts due from clients for corporate finance advisory services which are recorded net of allowance for the Group’s doubtful accounts. The Group generally grant credit terms of 5 days to the clients. In evaluating the collectability of receivable balances, the Group considers specific evidence including aging of the receivable, the client’s payment history, its current creditworthiness and current economic trends. The Group regularly reviews the adequacy and appropriateness of the allowance for doubtful accounts. Accounts receivable are written off after all collection efforts have ceased. As of June 30, 2023 and 2022, the allowance for doubtful accounts was nil.

Contract liabilities

The Group bills its clients based upon contractual schedules. The timing of revenue recognition, billings and cash collections result in accounts receivable and contract liabilities.

Contract liabilities represent the upfront payments received upon signing of the contract for initial public offering/independent financial advisory/financial advisory services and advances from clients related to compliance advisory services. Advance payments in excess of related accounts receivable are presented as contract liabilities on the consolidated balance sheets.

Lease

ASC 842 supersedes the lease requirements in ASC 840 “Leases”, and generally requires lessees to recognize operating and finance lease liabilities and corresponding right-of-use assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. All leases in the Group are accounted for as operating leases.

We determine if an arrangement is a lease at inception. On our balance sheet, our office lease is included in Operating lease right-of-use (ROU) asset, Current portion of operating lease liability and Operating lease liability, net of current portion.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. For leases that do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Significant judgment may be required when determining whether a contract contains a lease, the length of the lease term, the allocation of the consideration in a contract between lease and non-lease components, and the determination of the discount rate included in our office lease. We review the underlying objective of each contract, the terms of the contract, and consider our current and future business conditions when making these judgments.

Any lease with a term of 12 months or less is considered short-term. As permitted by ASC 842, short-term leases are excluded from the ROU asset and lease liabilities on the consolidated balance sheets. Consistent with all other operating leases, short-term lease expense is recorded on a straight-line basis over the lease term.

The Financial Accounting Standards Board (“FASB”) issued a Q&A in March 2020 that focused on the application of lease guidance in ASC 842 for lease concessions related to the effects of COVID-19. The FASB staff has said that entities can elect to not evaluate whether concessions granted by lessors related to COVID-19 are lease modifications. Entities that make this election can then apply the lease modification guidance in ASC 842 or account for the concession as if it were contemplated as part of the existing contract. The Company has elected to not treat the concessions as lease modifications and will instead account for the lease concessions as if they were contemplated as part of the existing leases. The Company has recorded negative variable lease expense and adjusted lease liabilities at the point in which the rent concession has become accruable.

The Group evaluates the impairment of its right-of-use assets consistent with the approach applied for its other long-lived assets. The Group reviews the recoverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Group has elected to include the carrying amount of finance and operating lease liabilities in any tested asset group and include the associated lease payments in the undiscounted future pre-tax cash flows. For the years ended June 30, 2023 and 2022, the Group did not have any impairment loss against its operating lease right-of-use assets.

Revenue recognition

The Group applied ASC Topic 606 “Revenue from Contracts with Customers” (“ASC 606”) for all periods presented.

The five-step model defined by ASC 606 requires the Group to:

(1)    identify its contracts with client,

(2)    identify its performance obligations under those contracts,

(3)    determine the transaction prices of those contracts,

(4)    allocate the transaction prices to its performance obligations in those contracts, and

(5)    recognize revenue when each performance obligation under those contracts is satisfied. Revenue is recognized when promised goods or services are transferred to the client in an amount that reflects the consideration expected in exchange for those goods or services.

The Group has elected to apply the practical expedient in paragraph ASC 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less.

The Group elected a practical expedient that it does not adjust the promised amount of consideration for the effects of a significant financing component if the Group expects that, upon the inception of revenue contracts, the period between when the Group transfers its promised services or deliverables to its clients and when the clients pay for those services or deliverables will be one year or less.

As a practical expedient, the Group elected to expense the incremental costs of obtaining a contract when incurred if the amortization period of the asset that the Group otherwise would have recognized is one year or less.

The Group is a financial services provider in Hong Kong which principally engages in the provision of corporate finance advisory services. The service offerings mainly comprise the following:

1.      Listing sponsorship and securities related services: Under this category of services, the Group either act as (i) sponsors to companies pursuing listing on the Main Board of the Stock Exchange and GEM of the Stock Exchange advising and guiding them throughout the listing process in return for sponsor’s fee; or (ii) underwriters, placing agents or referrers to our clients for their fundraising needs.

•        Listing sponsorship services:    The Group acts as sponsors to companies pursuing listing on the Main Board of the Stock Exchange and GEM of the Stock Exchange advising and guiding them throughout the listing process in return for sponsor’s fee.

The Group enters into a distinct contract with its clients for the provision of listing sponsorship services. The clients agree to pay a fixed fee by instalments over the contract terms as specified in the service agreements. The listing sponsorship services include assisting the client to engage different professional parties for its listing, carrying out due diligence, preparation of and reviewing prospectus and other submission documents including accountants’ report, legal opinions and profit and cash flow forecast memorandum, assessing the suitability of listing of the client, and advising on reorganization, assisting in preparation of roadshow materials and attending hearing for the listing application.

The entire service fee from clients is non-refundable and the Group is entitled to receive upfront payment upon signing the contract. As the listing sponsorship services involve a series of tasks which are interrelated and are not separable or distinct as the Group’s clients cannot benefit from any standalone task, the Group concludes that listing sponsorship services to be accounted for as a single performance obligation. The entire service fee of listing sponsorship services is allocated to a single performance obligation. The fees received upon signing the contract and other installments are recognized based on the point in time either (a) at the time of successfully listed on the Stock Exchange because it is the time that the performance obligation for listing sponsorship services are satisfied; or (b) lapse of the listing sponsorship contract. There is variable consideration in the transaction price. The transaction price depends on what services are provided to customer. There are cases which customer submitted the listing application but not able to process to attend the listing hearing and be listed.

•        Securities related services:    The Group either acts as (i) underwriters or placing agents by participating in underwriting and placing exercises by acting as an underwriting syndicate member, including an overall coordinator under the “sponsor coupling” requirement for Main Board IPOs who act as the head of a syndicate, or a placing agent in IPOs or other fundraising activities in the Stock Exchange in return for underwriting or placing commissions and/or fees; or (ii) referrers by referring investors to institutional clients for their fundraising needs.

The Group enters a distinct underwriting or referral agreement with its clients for the provision of securities related services. The securities related services are distinct and identified as one performance obligation. As stipulated in the underwriting or referral agreement, the Company will charge an underwriting or referral income based on certain percentage of the funds raised in the transaction, either IPO or other fundraising activities.

The Group is entitled to receive fee at the completion of services as stipulated in the service contract. Hence, revenue from providing underwriting or referral services to clients is recognized at a point in time when the transaction and the performance is completed, which is generally at the completion of an IPO, i.e., listing on the Stock Exchange, or the completion of a placement by client.

2.      Financial and compliance advisory services:    Apart from listing sponsorship services, the Group also provide other financial and compliance advisory services including:

•        FA services:    The Group acts as a financial advisor (i) to clients to advise them on the terms and structures of the proposed transactions, and the relevant implications and compliance matters under the Hong Kong regulatory framework including the Main Board Listing Rules, the GEM Listing Rules and the Takeovers Code; and (ii) to clients pursuing listing on other stock exchange.

The Group enters a distinct contract with its clients for the provision of FA services. The scope of work under FA services can vary from project to project and generally involves a series of tasks which are interrelated and are not separable or distinct as the Group’s clients cannot benefit from any standalone task. Therefore, the entire transaction prices of FA services are generally allocated to a single performance obligation.

The entire service fee from clients is non-refundable and the Group is entitled to receive upfront payment upon signing the contract. Revenue from upfront payment and other installments is recognized based on the point in time either (a) at the time of completion; or (b) lapse of the FA contract.

•        IFA services:    The Group acts as an independent financial advisor to give opinions or recommendations to the independent board committee and independent shareholders of the listed companies, in return for advisory fee.

The Group enters a distinct contract with its clients for the provision of IFA services. The Group’s IFA services include (i) conducting reviews and analyses on the proposed transactions and assessing the fairness and reasonableness of the terms of the proposed transactions; (ii) issuing our opinion, in the form of an IFA letter, to the independent board committee and/or independent shareholders of listed issuers with voting recommendations, which are incorporated in the circulars pursuant to the Main Board Listing Rules, the GEM Listing Rules and the Takeovers Code; and (iii) obtaining the necessary clearance in relation to our opinion letters from the Stock Exchange and/or the HKSFC.

The entire service fee from clients is non-refundable and the Group is entitled to receive upfront payment upon signing the contract. As the IFA services involve a series of tasks which are interrelated and are not separable or distinct as the Group’s clients cannot benefit from any standalone task, the Group concludes that the IFA services to be accounted for as a single performance obligation. The entire transaction prices of IFA services are allocated to a single performance obligation and the fees received upon signing the contract and upon issuance of circular which contains IFA letter, is recognized at the point the issue of circular on the Stock Exchange because it is the time that the scope of work for acting as an IFA such as carrying out due diligence, preparation of IFA letter to independent board committee and independent shareholders, and replying to queries from the Stock Exchange and/or the HKSFC are completed. For projects which are terminated or lapsed at expiry of contracts, the revenue from the upfront fee is recognized at the time of termination or lapse of contracts.

•        CA services:    The Group acts as a compliance advisor to the listed companies on the Main Board or GEM and advise them on post-listing compliance matters in return for compliance advisory fee.

The Group enters a distinct contract with its clients for the provision of CA services. The Group concludes that each monthly CA service (i) is distinct and (ii) meets the criteria for recognizing revenue over time. In addition, the Group concludes that the services provided each month are substantially similar and result in the transfer of substantially similar services to the clients each month. That is, the benefit consumed by the clients is substantially similar for each month, even though the exact volume of services may vary. Therefore, the Group concludes that the monthly CA services satisfy the requirements of ASC 606-10-25-14(b) to be accounted for as a single performance obligation. There is no variable consideration, significant financing components or noncash consideration in the contracts. Accordingly, based on the output methods, the Group recognizes revenues from CA services on a monthly basis when it satisfies its performance obligations throughout the contract terms. There is no contract asset that the Group has right to consideration in exchange for its CA services that the Group has transferred to its clients. Such right is not conditional on something other than the passage of time.

Recent Accounting Pronouncements

See the discussion of the recent accounting pronouncements contained in Note 2 to the consolidated financial statements, “Summary of Significant Accounting Policies”.

Total market capitalisation of companies listed on the Main Board and GEM

The following chart illustrates the total market capitalization of companies listed on the Main Board and GEM as of the respective year end date from 2012 to 2021.

Source: The website of the HKSFC — Published resources — Statistics — Table B1 — Highlights of the Hong Kong Stock Market (Updated: September 30, 2022)

As of 31 December 2021, the market capitalization of the companies listed on the Main Board and GEM amounted to approximately US$5,387.0 billion and US$13.8 billion, respectively, with a CAGR of about 6.8% and 3.3% since 31 December 2012, respectively. About 99.7% of total market capitalization fell to the Main Board as of 31 December 2021.

Number of listed and newly listed companies and new listing applications in Hong Kong

The Stock Exchange operates two markets, the Main Board and GEM, for companies to list their shares. The Main Board is a market for more established companies while GEM is a market with lower listing eligibility criteria but similar continuing obligations compared to the Main Board.

As of December 31, 2021, there were a total of 2,219 companies and 353 companies listed on the Main Board and GEM, respectively, with a CAGR of approximately 5.0% and 7.0% since December 31, 2012, respectively. Among these, 97 and 1 of the listed companies were newly listed on the Main Board and GEM during 2021, respectively. The number of new listing applications on the Main Board and GEM was 372 and 25 for 2021, respectively.

The following charts illustrate the number of newly listed companies in Hong Kong as of the respective year end date from 2015 to 2021 and the number of new listing applications in Hong Kong as of the respective year end date from 2014 to 2021.

* Figures includes the number of companies for transfer of listing from GEM

Source: The Stock Exchange Fact Book 2016 – 2021

*Figures include eventually listed, active, lapsed, withdrawn and rejected applications

Source: The Stock Exchange consolidated index for application proofs (Main Board and GEM)

It is believed that the significant numbers of listed and newly listed companies and listing applications on the Stock Exchange would create considerable opportunities for our corporate finance advisory service business, including listing sponsorship and securities related service, financial advisory services and compliance advisory service.

strong and active market for fund raising activities in Hong Kong. An observable rebound can be seen in the amount of equity funds raised from Post-IPO fund raising activities on the Stock Exchange after 2019. In 2021, such amount totaled at approximately US$55.90 billion, exceeding the amount of equity funds raised from IPOs in the same year.

Fund raising activities, including both IPOs and those in the secondary market such as rights issue and placings, conducted by listed companies may require listed companies to engage a financial adviser or an independent financial adviser to provide financial advisory services. As our business included the provision of financial advisory services to secondary fund raising activities of listed companies in Hong Kong, an strong and active fund raising market in Hong Kong will widen the pool of our potential clients.

Takeovers Codes related matters

General and partial offers, privatizations, share repurchases and whitewash waiver applications affecting public companies in Hong Kong are governed by the Takeovers Codes. The following chart illustrates the number of Takeovers Codes related transactions and applications for each of the seven years ended December 31, 2021.

*Figures comprise general and partial offers under the Takeovers Codes, privatizations, whitewash waiver applications and off-market and general offer share buy-backs
Source: HKSFC annual report 2015/16 – 2021/22

Takeovers Codes related transactions, including general and partial offers, privatizations, share repurchases and whitewash waiver applications, usually require financial advisory and/or independent financial advisory services pursuant to the relevant requirements under the Takeovers Codes. Over the recent years, Takeovers Codes related transactions and applications remained active in the Hong Kong capital market. We believe that there exist ample opportunities for us to participate in such activities as financial advisers which would boost our performance.

Market Drivers

The Hong Kong capital market has experienced a long history of development. The main drivers include the following:

Internationalized capital market

The internationalization of the Hong Kong capital market is featured by its high level of openness to and freedom of capital flow, and the active participation of global financial institutions. Many well-known international investment banks have set up branches in Hong Kong. There is no limit on foreign investments imposed in the Hong Kong stock market. Meanwhile, local investors can freely participate in investment in overseas markets such as Singapore, London and New York. Such free flow of capital and barrier-free investment attract overseas institutions and make significant contribution to the development of the Hong Kong capital market.

Diversified funding sources

The Hong Kong capital market has a mature system of market operation rules after decades of development, allowing the use of diversified financial instruments and mergers and acquisitions and financing activities to be conducted conveniently. Accordingly, financing activities are greatly functional in Hong Kong and IPOs and secondary offerings are expected to continue to attract foreign investments compared to the stock market in other jurisdictions which is not as open and transparent as that in Hong Kong.

BUSINESS

Overview

Commencing operation since October 2017, we are a Hong Kong-based financial services provider principally engaged in the provision of corporate finance advisory services, through our indirect wholly-owned Operating Subsidiary, Red Solar, which is a licensed corporation under the SFO to conduct Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities in Hong Kong. Our corporate finance advisory services mainly comprise the following:

•        Listing sponsorship and securities related services:

(a)     Listing sponsorship services:    Being one of the 127 active licensed sponsors in Hong Kong licensed under the SFO as of May 1, 2023 who are licensed to provide listing sponsorship services in Hong Kong, we act as the sponsors to companies pursuing listing on the Main Board and GEM, advising and guiding the companies and their directors throughout the listing process, and performing all duties of a sponsor as required under applicable rules and regulations, in return for the sponsor’s fee.

(b)    Securities related services:    Pertinent to our listing sponsorship services, we also provide securities related services, including: (i) underwriting and placing services, principally as “sponsor-overall coordinator”, for listing applicants who we provide listing sponsorship service, pursuant to the Sponsor Coupling requirement by the Hong Kong Stock Exchange, in return for underwriting or placing commissions and/or fees; and (ii) other ancillary services, such as referral services to the underwriting, placing and other fund-raising exercises conducted by other underwriters, placing agents, financial institutions, in return for referral commissions and/or fees.

•        Financial and compliance advisory services:    We also provide financial and compliance advisory services under our Type 6 (advising on corporate finance) license, in return for a fixed or monthly advisory fee. By acting as:

(a)     financial advisers (i) to listed companies in Hong Kong as well as their shareholders and investors advising them on the terms and structures of proposed transactions, and the relevant implications of the Hong Kong regulatory framework, which primarily included the Main Board Listing Rules, GEM Listing Rules, and Takeovers Codes, in relation to the transactions; and (ii) to clients pursuing listing on other stock exchanges;

(b)    independent financial advisers to the independent board committee and independent shareholders of listed companies in Hong Kong rendering recommendations and opinions; and/or

(c)     compliance advisers to listed companies in Hong Kong and advise them on post-listing compliance matters.

We aspire to provide an integrated full-service platform for our clients with integrated financial services tailored to their varying needs. Going forward, we endeavor to expand our corporate finance advisory service coverage internationally; in particular, to strengthen our financial advisory services to cater to the increase of demand from our clients’ network who desire to pursue listing in the U.S. capital market or other international capital markets, and to expand our international network and coverage to develop our corporate finance advisory services.

Since the commencement of the corporate finance advisory business of Red Solar, we have actively participated in the equity capital market in Hong Kong. Our clients comprise both smaller and larger private and listed companies from a spectrum of industry sectors, based in Hong Kong, countries in Southeast Asia, and Mainland China. The market capitalization of our listed clients ranged approximately from around HK$100 million to over HK$20 billion.

For the years ended June 30, 2023 and 2022, we were engaged in three and five listing sponsorship projects and 13 and 18 financial and compliance advisory projects, respectively. As we only have commenced the securities related services in August 2022, we were not engaged in any underwriting, placing, or other securities related projects during the year ended June 30, 2022 but we were engaged in one securities related project during the year ended June 30, 2023. For the years ended June 30, 2023 and 2022, our total revenue was approximately US$677,685 and US$679,482, respectively, of which approximately US$102,076 and US$237,031, or approximately 15.0% and

34.9%, respectively, was generated from our listing sponsorship services; approximately US$306,229 and nil, or 45.2% and nil, respectively, was generated from our securities related services; and approximately US$269,380 and US$442,451, or approximately 39.8% and 65.1%, respectively, was generated from our financial and compliance advisory services.

Competitive Strengths

We offer comprehensive corporate finance advisory services, and our proven track record and experience in the highly-regulated Hong Kong financial market help us go beyond.

We strive to become an integrated financial services platform with Hong Kong expertise and global vision, to provide comprehensive corporate finance advisory services to our clients, from pre-IPO, IPO to post-IPO stages, to fulfill their varying needs in the highly regulated Hong Kong financial market. As a licensed corporation under the SFO to carry out Type 1 (dealing in securities) and Type 6 (advising on corporate finance) regulated activities, our Operating Subsidiary is able to carry out all types of Type 6 regulated activities in Hong Kong, including listing sponsorship, financial and compliance advisory and all matters and transactions falling within the ambit of the Takeovers Codes. For instance, we could act as pre-IPO financial advisor to our clients to provide advice to corporate structure, financial management, and corporate governance and assist them to raise pre-IPO funding for expansion, and we could also act as a sponsor in listing applications in Hong Kong during the IPO stage. We could also participate in underwriting and placing exercises by acting as an underwriting syndicate member, including an overall coordinator under the “sponsor coupling” requirement for Main Board IPOs who act as the head of a syndicate, or a placing agent in IPOs or other fundraising activities in the Stock Exchange. Furthermore, we could also act as financial adviser to listed companies in Hong Kong advising them on transactions involving the Main Board Listing Rules, GEM Listing Rules or Takeovers Codes or as an independent financial adviser to independent board committees and independent shareholders of listed companies in Hong Kong rendering recommendations and opinions. Lastly, we could also act as compliance advisers and offer all-round compliance advisory services to our clients to ensure their compliance with the Main Board Listing Rules, GEM Listing Rules, or Takeovers Codes and other relevant rules and regulations. Leveraging on our license coverage, since our establishment in 2017 and up to the date of this prospectus, we have been engaged by our clients in 16 listing sponsorship projects, three securities related projects and 56 financial and compliance advisory projects.

We believe our ability to provide our clients with comprehensive corporate finance advisory services not only fulfils their needs at different stages of their business in a compliant manner but also fosters our long-term solid relationship with them. Furthermore, we believe that our comprehensive scope of corporate finance advisory services enables us to create cross-selling opportunities and the synergies across different services and in turn maximize our revenue and may create new business opportunities for us, all of which are crucial for enhancing business sustainability and coping with the emerging challenges in the market.

We have established a strong client base and extensive business network across a wide spectrum of sectors.

We serve a diverse and solid base of clients. We believe that market reputation and clients’ confidence in our services are indispensable to our continuous success. Our active participation and proven track record in the Hong Kong corporate finance market continuously enhance our brand awareness and build trust with our existing and potential clients, which together help us securing new business in the competitive market. Furthermore, our market, client, and professional parties partners coverages extend beyond the PRC and Hong Kong, as a significant portion of our clients are companies from countries in Southeast Asia, such as Malaysia and Singapore. Our major clients are mainly listing applicants pursuing listing and listed companies on the Main Board or GEM, as well as private companies and investors. They comprised companies from a diverse spectrum of businesses and regions, including but not limited to, information technology, IT securities, advanced technologies, mobile gaming, virtual assets and non-fungible-tokens, manufacturing, natural resources and materials, wholesale and retail of consumer products, sales and marketing, financial institutions and service providers, and bar and restaurant. We have also established a wide industry network comprising professionals in various fields, such as laws, corporate finance, accounting, industry experts, public relations and FinTech. Leveraging on our established network of clients and business partners, we often receive referrals of projects from time to time.

We also nurture our network and relationship with start-ups, entrepreneurs, and small businesses in Hong Kong and overseas, to especially those with strong growth potential to be our future clients. We participated in a program organized by a Hong Kong digital technology hub and incubator, which is managed by a wholly-owned subsidiary of the Hong Kong government and connected with over 1,800 start-ups and technology companies ranging from

FinTech, smart living, cybersecurity, AI, big data to the blockchain, to provide selected companies with mentorship based on our expertise and know-how in corporate finance, compliance, business support, and global financial market, with the goal to establish the reputation of a trusted advisor and a strong rapport since the start-up stages of our potential clients.

Most importantly, we intend to extend our corporate finance advisory services to global clients pursuing opportunities in major international capital markets, in particular the U.S market. Furthermore, we believe our diversified client base and market focus will mitigate our risk arising from the cyclical fluctuation of certain industry sectors and domestic economic conditions. Our experience and successful track record in providing services to clients from different industry sectors and our established industry network will also enhance our capability in sourcing new clients and our ability to resolve issues that are unique to the specific industry sectors.

A proven and experienced management team consisting of industry veterans.

We are led by a team of experienced management and professionals with substantial expertise in formulating corporate strategies, and monitoring risks and compliance, and managing, executing, and supervising our operations, with an aim to provide services to our clients in a reliable, efficient and professional manner. Leveraging on our industry veteran’s networks in the financial industry, experience, and expertise gained from other renowned corporate finance firms and regulatory body, we believe that we are able to respond promptly and appropriately to the ever-changing market conditions and environment as well as continue to expand our client base. For example, Mr. On Tai, LAM, our founder, Chief Executive Officer, and the chairman of the board, had over 24 years of experience in the banking, securities, and corporate finance services industries. Mr. Chi Fung Leo, CHAN, our founder, Chief Financial Officer and director, had over 20 years in the finance and accounting industries. Together with our senior management team, our staff enables us to implement our business strategies, provide quality services to our clients, manage our compliance and risks, identify and capture business opportunities, maintain relationships with existing clients, and procure prospective clients. We believe that our loyal and competent team of experienced management and professional staff represents valuable human capital for us. Leveraging on their substantial experience in the industry and in-depth knowledge in our operations and clients, we have been successful in expanding our business and client base.

We value service quality and control, hence adopt a prudent compliance and risk management system and conduct our business in a compliant way.

Hong Kong’s financial market is highly regulated. We strictly comply with applicable rules and regulations, including but not limited to the Main Board Listing Rules or GEM Listing Rules, Takeovers Codes, the SFO and other Hong Kong laws and regulations, during our course of operation and provision of our services. Since the commencement of our business in October 2017, no fine, penalty nor disciplinary action has been made against us, our Responsible Officers, licensed representatives, or any of our personnel.

We consider our compliance and internal control system pivotal to our operations as it enables us to identify, assess and manage our business, financial and operational risks in our business in a timely manner. We have also established internal control policies and procedures for identifying, assessing, reporting, monitoring, and mitigating compliance risks by which compliance risks are to be identified and managed through all levels of our organization. Our effective compliance and risk management system and internal control policies help us to prevent potential losses and liabilities and raise the confidence of clients, investors and shareholders, which we consider crucial in maintaining our market position and reputation.

We also benefit from the vast experience of our senior management team in the financial service industry who play a leading role in implementing our compliance and internal control system. Our management and our compliance officer, are responsible for overseeing the management of our compliance risk and monitoring our overall compliance according to our internal control policies, operational guidelines and procedures, and applicable regulatory requirements. Our compliance officer will also assist and advise our management from time to time on the management of our compliance risk and on updates in the regulatory environment.

To ensure the efficient implementation of our compliance and risk management system and internal control policy and our daily operation and project execution to be conducted in a compliant way, we have implemented the “manager(s)-in-charge” policy. In which, we will appoint the senior members of our staff to be the “manager(s)-in-charge”

of one or several of the core functions of our operation, being: (i) overall management oversight; (ii) key business line; (iii) operational control and review; (iv) risk management; (v) finance and accounting; (vi) information technology; (vii) compliance; and (viii) anti-money laundering and counter-terrorist financing. The “manager(s)-in-charge” are expected to actively participate in or are responsible for directly supervising our business of regulated activities, and are responsible for managing the respective function(s), decision making and reporting directly to the board of directors. Through implementing the “manager(s)-in-charge” system, we believe we can ensure the maintenance of appropriate standards of conduct and adherence to proper procedures during our daily course of operation and projects execution.

Growth Strategies

Our principal business objective is to further strengthen our position in the financial services industry in Hong Kong, and establish and expand our market presence in international capital markets, in particular the United States. We intend to achieve our plan by adopting the following key strategies:

To strengthen our underwriting and placing services

Since October 2017, we have been licensed by HKSFC to conduct Type 1 (dealing in securities) regulated activities under the SFO, through our indirect wholly-owned Operating Subsidiary, Red Solar, amongst which, we are licensed to participate in underwriting and placing exercises by acting as (i) book runner, lead manager, or underwriter of listing applicants in IPOs or other fundraising activities in Stock Exchange; and (ii) placing agent of listed companies in connection with their issuance or sale of securities, in return for underwriting and/or placing commission. Currently, we have only been engaged as the underwriters to IPOs in the Stock Exchange which we act as the listing sponsors, as part of our listing sponsorship services, since starting from 5 August 2022 we are required by the Main Board Listing Rules Rule 3A.02 and Rule 3A.43 to be appointed as the overall coordinator who acts as the head of underwriting syndicate for the IPOs in Stock Exchange which we act as the listing sponsors.

We intend to earmark sufficient financial resources for our underwriting and placing business and use a portion of the proceeds from this Offering to increase the liquid capital of Red Solar, for the purpose of expanding our placing and underwriting services capacity in Hong Kong by acting as the underwriters to IPOs which we do not act as the listing sponsor and/or participating in international fund-raising exercises as the selling group members targeting retail and institutional investors in Hong Kong and Southeast Asia. Furthermore, we intend to establish our placing and underwriting team through the recruitment of additional staff, including the Responsible Officer with extensive securities and equity capital markets experience and network, and licensed representatives, respectively, with equity capital market and finance experience.

With a strengthened capital base and the expansion of our team, we will be able to participate more actively as underwriters in IPOs and other secondary market fund raising projects by (i) participating in fund raising exercises which we do not act as the listing sponsor with a larger fund-raising scale and/or higher percentage of underwriting commitment; (ii) expanding our underwriting business by taking up more underwriting opportunities to IPOs which are not sponsored by us; (iii) reducing the reliance on other underwriters in our underwriting exercises which may in effect reducing our potential underwriting fees and commissions of the IPOs which we act as sponsor and the head of underwriting syndicate; and (iv) exploring business opportunities for secondary market fund raising transactions, such as rights issues, open offers and/or private placing for listed companies on the Stock Exchange.

We believe expanding the underwriting and placing services will provide immense synergies with our existing corporate finance advisory services. Not only the solid underwriting or placing capability could enable us to generate additional underwriting and placing commission income, provide comprehensive services to our clients, enhance our competitive edge, but our enhanced ability to take on underwriting and placing projects will also help to drive our corporate finance advisory business, as one of the key determinations for our potential clients in selecting an listing sponsorship service provider is the underwriting capability of the service provider. We also believe our proven track record in the provision of corporate finance advisory services and the strengthening of our underwriting business will also help us retain and attract more clients which then enable us create synergies across different business lines, optimize our client coverage effort, create new business opportunities for each business segment and in turn generate diversified sources of revenue and maximize our revenue.

To develop our asset management business

We plan to set up our asset management arm and apply to the HKSFC for licenses to carry on Type 4 (advising on securities) and Type 9 (asset management) regulated activities, by recruiting professionals with relevant experiences and networks. We are of the view that the asset management business could enable us to provide more comprehensive services to our institutional and professional investor clients.

We also plan to launch a fund with the objective to invest in a portfolio consisting primarily of equities, bonds and other securities of companies in prevailing global investment hot topics such as Environmental, Social and Governance and Financial Technology industries with excellent management, business model, products, and sound financials for long-term sustainable growth. We plan to use a portion of proceeds from this Offering as seed money for such fund. We also plan to enhance our research capabilities to better serve our asset management team, high-net-worth individual clients and institutional investors by continuously recruiting qualified research analysts to support the investment decision-making and investment management processes of the asset management team.

To strengthen our corporate finance advisory services

With the organic growth in our corporate finance advisory business and our expansion into various international capital market based on our expanding client base, we will continue to place a significant focus on our corporate finance advisory business and expand our corporate finance advisory team, recruiting additional experienced professional staff including Responsible Officers and licensed representatives to ensure that we have sufficient staff with appropriate levels of knowledge, skills, network and experience to provide our services. In particular, we intend to make additional hires of director-level Responsible Officers with extensive client network and business development expertise, as the rainmaker with project execution ability, in order to expand our client base and enhance our marketing and brand awareness.

We intend to enhance the remuneration package of our existing corporate finance team members to retain talents and professionals due to the intense competition for professionals and talents in Hong Kong financial industry. We believe a stronger corporate finance team could enlarge our project execution capacity to provide quality services, thus enhancing our income-generating ability, and could help us maintain effective systems and controls to ensure our fulfilment of obligations and responsibilities and compliance with relevant rules and regulations.

Furthermore, we intend to establish and expand our financial advisory service covering international capital markets, in particular the United States. We observe the rising demand for financial advisory services from companies located in Mainland China, Hong Kong, and Southeast Asia, to conduct IPO in the U.S. capital market or other fund-raising activities in the international capital market. To capture such opportunities, we plan to replicate our expertise in Hong Kong capital market and extend such expertise by acting as the financial advisers to clients who wish to gain access to the international capital market, offering advisory services in relation to corporate reorganization, transaction structure, financial and project management, corporate governance, and pre-IPO activities. Starting from late 2022, we have been engaged as the financial adviser to clients pursuing IPO in a U.S. stock exchange. We believe our intended expansion of our financial advisory service capacity will better serve our clients for their need to access the international capital market, and further enhance our income-generating ability, and lay a stronger foundation for our future growth internationally.

To promote and enhance the Red Solar brand

We believe that our market reputation and clients’ confidence are essential to our success. As such, we intend to enhance our brand image and industry position by conducting more marketing and public relations activities, such as hosting seminars, training, and workshops among industry players and potential clients, in Hong Kong, Mainland China, and the United States. Leveraging on our established reputation within the financial services industry, with the enhanced brand awareness through marketing activities, we believe we will be able to maintain a high level of creditability and broaden our client base.

Our Services

We are a financial services provider in Hong Kong, principally engaging in the provision of corporate finance advisory services, including (i) listing sponsorship and securities related services; and (ii) financial and compliance advisory services, which mainly include financial advisory services, independent financial advisory services, and compliance advisory services. We provide our services through Red Solar, our Operating Subsidiary in Hong Kong.

The table below sets out a breakdown of revenue generated from our corporate finance advisory business for years ended June 30, 2023 and 2022:

Listing sponsorship and securities related services

Listing sponsorship services

Since the commencement of our corporate finance advisory business in October 2017, we have been registered as a licensed sponsor and actively providing listing sponsorship services to corporate clients pursuing listing on the Main Board and GEM of the Stock Exchange through our indirect wholly-owned Operating Subsidiary, Red Solar.

The primary role of a sponsor in a listing exercise in the Stock Exchange is to provide assurance to the Stock Exchange and the market generally that the listing applicant complies with the Main Board Listing Rules (or the GEM Listing Rules) and other relevant legal and regulatory requirements, and that the listing document provides sufficient particulars and information for investors to form a valid and justifiable assessment of the listing applicant’s businesses, financial condition, and valuation.

Our main responsibilities as a sponsor to listing applicants include: (i) guiding and advising listing applicants through the IPO process, in respect of the Main Board Listing Rules (the GEM Listing Rules for GEM applicants) and other relevant regulatory requirements; (ii) overall coordination of the listing process, including managing the entire listing process, formulating listing plan and offering strategies, ensuring proper execution of the listing timetable, advising the clients on the engagement of professional parties, anticipated costs and major milestones and challenges during the listing process; (iii) conducting due diligence (including conducting site visits and reviewing clients’ documents to understand clients’ major business operations, financial information, legal and compliance matters, conducting interviews with clients’ and suppliers and reviewing clients’ internal control matters and ensuring that the due diligence standards under Practice Note 21 to the Main Board Listing Rules or Practice Note 2 to the GEM Listing Rules (as the case may be) and the Code of Conduct are met); (iv) preparing and reviewing all relevant documents, such as the prospectus, together with other professional parties, ensuring sufficient disclosure in the prospectus and application documents in compliance with the relevant regulatory requirements, making submissions and addressing comments and matters raised by the regulatory bodies in connection with the listing application; (v) liaising and communicating with the regulatory bodies and responding to the queries from them in the vetting process; (vi) liaising with the intermediaries and underwriting syndicates; (vii) assessing investors’ interests in the proposed listing; (viii) overall management of public offer to ensure that the public offer is conducted in a fair and orderly manner; and (ix) maintaining sufficient books and records to demonstrate that proper due diligence is conducted, contentions issues are investigated and how conclusions are reached.

Since the commencement of business of Red Solar in October 2017, we have been engaged in 16 listing projects as the listing sponsor. For years ended June 30, 2023 and 2022, we recognized listing sponsorship income of approximately US$102,076 and US$237,031, respectively, representing approximately 15.0% and 34.9% of our total revenue for the respective years.

Securities related services

Pertinent to our listing sponsorship services, we also provide securities related services, including underwriting services, placing services, and other ancillary services, such as referral services to the underwriting and placing exercise conducted by other underwriters and placing agents.

Since October 2017, we have been licensed by HKSFC to conduct Type 1 (dealing in securities) regulated activities under the SFO, through our indirect wholly-owned Operating Subsidiary, Red Solar, amongst which, we are licensed to participate in underwriting and placing exercises by acting as overall coordinator, bookrunner, lead manager, underwriting syndicate member, and/or placing agent in IPOs on Stock Exchange or other fundraising activities, in return for underwriting or placing commissions and/or fees. Although we are licensed to participate in underwriting and placing exercises, historically, we have not conducted any Type 1 regulated activities related services, such as the underwriting and placing services, until August 2022.

Effective from 5 August 2022, as stipulated by Main Board Listing Rules Rule 3A.02 and Rule 3A.43, in the case of Main Board listing, a sponsor for IPOs in Stock Exchange must also be appointed as one of the overall coordinators (commonly known as the “Sponsor Coupling” requirement by the Stock Exchange). The overall coordinator is the underwriter who acts as the “head of syndicates” responsible for the overall management of the share offering, coordination of book building or placing activities, and exercise control over book building activities and market allocation recommendations to the issuer.

In response to the Main Board Listing Rules Rule 3A.02 and Rule 3A.43, in August 2022, we have commenced our underwriting and placing services with limited capacity as the sponsor-overall coordinator. As of the date of the prospectus, our underwriting and placing services are in the early stage of development. As of June 30, 2023 and the date of the prospectus, we have only provided underwriting services in capacity as the sponsor-overall coordinator, for listing applicants who we provide listing sponsorship service, as required the Sponsor Coupling arrangement.

However, we also endeavor to further strengthen our underwriting and placing services capacity, see “Growth Strategies — To strengthen our underwriting and placing services” above for further details regarding our plans to expand our underwriting and placing services. We have been actively exploring various underwriting and placing business opportunities to strengthen our underwriting and placing services since its commencement, in view to take up more underwriting and placing opportunities to IPOs/fund-raising exercises which are not sponsored by us, and to reduce the reliance on other underwriters in the IPOs which we act as the sponsor-overall coordinator. Since the commencement of our underwriting and placing services and for the year ended June 30, 2023, we participated in one placing exercise by providing referral services to the issuer listed in Stock Exchange and its placing agent for its fund-raising exercise, introducing investors in return for referral commissions/fees. The referral commission/fee income from our placing services amounted to approximately US$306,229 and nil for the year ended June 30, 2023 and 2022, respectively, representing approximately 45.2% and nil of our total revenue for the respective years.

Furthermore, for the year ended June 30, 2023 and 2022, respectively, we were engaged in two and nil underwriting projects in the capacity of sponsor-overall coordinator. Underwriting commission/fee income from our services amounted to approximately nil and nil for the year ended June 30, 2023 and 2022, respectively, as the underwriting commission/fee are only payable upon the completion of the projects.

Financial and compliance advisory services

Our financial and compliance advisory services include financial advisory services, independent financial advisory services, and compliance advisory services. For the years ended June 30, 2023 and 2022, we were engaged in 13 and 18 financial and compliance advisory projects, respectively. Advisory fee income from our financial and compliance advisory services amounted to approximately US$269,380 and US$442,451 for the years ended June 30, 2023 and 2022, respectively, representing approximately 39.8% and 65.1% of our total revenue for the respective years.

Financial advisory and independent financial advisory services

Our financial advisory services include advising our clients on the terms and structure of the proposed transactions, such as the IPO(s) in the Stock Exchange and other overseas exchanges, the issue of securities, merger and acquisition, and restructuring, and the relevant requirements, implications and compliance of law and regulatory framework on proposed transactions and other corporate actions from time to time.

As a financial adviser, our main responsibilities (which may vary case by case) may include, without limitation: (i) assisting the client in negotiating and advising on the terms and conditions of the transaction; (ii) advising on the structure of the proposed transaction; (iii) the engagement of professional parties and coordinating the professional parties throughout the transaction; (iv) together with other professional parties, advising the client in relation to the legal and compliance matters, such as relevant implications under the Main Board Listing Rules, the GEM Listing Rules and the Takeovers Codes for transactions which involve listed companies or listing applicant in Hong Kong Stock Exchange, and/or applicable law, rules, codes and regulatory framework for transactions outside of Hong Kong; (v) supervising the preparation of and reviewing the required documentation; (vi) submission on behalf of the client of documents such as letters of advice, announcements, circulars and other documents as required by the Stock Exchange and/or the HKSFC; (vii) advising on the internal control and risk management; and (viii) advising on the accounting and financial and treasury management.

We also act as independent financial advisers to listed issuers in Stock Exchange, in relation to certain types of its proposed transactions that are required by the relevant rules and regulations in Hong Kong, including the Main Board Listing Rules, the GEM Listing Rules, and/or the Takeovers Codes, for the appointment of an independent financial adviser. The primary responsibility for the independent financial advisor is to provide an opinion as to whether the terms of the proposed transactions are fair and reasonable for the independent securities holders of the listed issuers.

As independent financial adviser, we are mainly responsible for conducting reviews and analyses on the proposed transactions and assessing the fairness and reasonableness of the terms of the proposed transactions. Upon such assessments, we issue our opinion letters to the independent board committee and/or independent shareholders of listed issuers with voting recommendations, which are incorporated in the circulars pursuant to the Main Board Listing Rules, the GEM Listing Rules and the Takeovers Codes. We are also responsible for assisting our clients to obtain the necessary clearance or approval in relation to our opinion letters from the Stock Exchange and/or the HKSFC.

Since the commencement of our operation in October 2017, we were engaged in 16 financial advisory and 15 independent financial advisory projects. For the years ended June 30, 2023 and 2022, our financial advisory fee income (generated from both financial advisory and independent financial advisory services) amounted to approximately US$59,332 and US$186,422, respectively, representing approximately 8.8% and 27.4% of our total revenue for the respective years.

Compliance advisory services

We act as compliance advisers, who must be licensed sponsors in Hong Kong, for companies listed on the Main Board or GEM of Stock Exchange. In accordance with the Main Board Listing Rules and the GEM Listing Rules, each newly listed company in Hong Kong is required to engage a compliance adviser to ensure its compliance with applicable rules for an initial period that commences from the date of its listing and ends on the date on which the listed company complies with (i) the Main Board Listing Rules requirements in respect of its financial results for the first full financial year commencing after the date of its listing; or (ii) the GEM Listing Rules requirements in respect of its financial results for the second full financial year commencing after the date of its initial listing. At any time after the initial period, the Stock Exchange may direct the listed company to appoint a compliance adviser for a specific period and to undertake the compliance advisory role as may be specified by the Stock Exchange.

Our responsibilities as a compliance adviser include: (i) ensuring that the client is properly guided and advised as to compliance with the Main Board Listing Rules or the GEM Listing Rules (as the case may be) and all other applicable laws, rules, codes and guidelines; (ii) discussing with the client on its operating performance and financial condition with reference to the client’s business objective(s) as stated in its listing document; (iii) ensuring the client’s compliance with any undertakings provided by the client and its directors at the time of listing and with the terms and conditions of any waiver granted to the client by the Stock Exchange, and, in the event of non-compliance, discuss the issue with the board of directors of the clients and make recommendations to the board regarding appropriate remedial steps; (iv) providing the client with advice and guidance on compliance with the Main Board Listing Rules or the GEM Listing Rules (as the case may be) in relation to its regulatory announcements, circulars and financial reports; (v) providing regular updates on any material changes of or supplements to the Main Board Listing Rules or the GEM Listing Rules (as the case may be) to the client’s directors and senior management; (v) assessing the understanding of all new appointees to the board of the clients regarding the nature of their responsibilities and fiduciary duties as a director of a client, and, to the extent the compliance adviser forms an opinion that the new appointees’ understanding is inadequate, discuss the inadequacies with the board and make recommendations to the board regarding appropriate remedial steps

such as training; and (vi) in relation to an application by the clients for a waiver from any of the requirements in Chapter 14A of the Main Board Listing Rules or Chapter 20 of the GEM Listing Rules (as the case maybe), advising the clients on their obligations and in particular the requirement to appoint an independent financial adviser.

Since the commencement of our operation in October 2017, we were engaged in 26 compliance advisory projects. For years ended June 30, 2023 and 2022, our compliance advisory fee amounted to approximately US$210,048 and US$256,029, respectively, representing approximately 31.0% and 37.7% of our total revenue for the respective years.

Pricing Policy

Our corporate finance advisory fees were determined on a case-by-case basis after arm’s length negotiations with each client. The terms of the service fees including the payment schedule vary in accordance with the type of services we provide, nature of the transactions, scope of our duties, length of time we expect to spend, complexity of the transactions and our expected workload.

For provision of listing sponsorship services, we charge our clients an agreed sponsor fee, which is determined with reference to the estimated time and amount of work required, which is determined by, among others, nature of the client’s principal business, geographical locations of the client’s business operations, complexity of the IPO projects including restructuring, listing issues required to be resolved before application for listing and intensity of listing timetable and manpower required for performing due diligence.

Our sponsor fee is generally payable by four installments upon the occurrence of the milestone events defined in the mandate, namely, (i) signing of engagement letter; (ii) submission of listing application to the Stock Exchange; (iii) listing hearing; and (iv) upon listing. In some cases of provision of listing sponsorship services to our clients, upon successful listing and completion of the IPO, our clients may pay us additional sponsor fees as bonus in recognition of our contribution and dedication to the successful listing. Such bonus was paid by our clients to us on discretionary basis, the amount of which was determined by our clients at their sole discretion.

For provision of securities related services, our fees were determined on a case-by-case basis after arm’s length negotiations with each client taking into account the nature of the transactions, scope of our duties, expected length of time to complete the transactions, complexity of the transactions and our expected workload. For the underwriting and placing exercises, we usually charge a fixed percentage of the size of the of the client’s gross proceed as our underwriting fee. For investment referral, we usually charge a fixed percentage of the size of the investment or transaction being referred. The fee for the underwriting and investment referral services are generally payable in full upon completion of the transaction.

For provision of financial advisory or independent financial advisory services, our advisory fees were determined on a case-by-case basis after arm’s length negotiations with each client taking into account the nature of the transactions, scope of our duties, expected length of time to complete the transactions, complexity of the transactions, our expected workload and requirement of particular deliverables such as letter of advice or feasibility report. The advisory fee is generally payable by instalment according to the pre-defined milestones during the process of the transaction such as (i) upon signing of the engagement letter; (ii) upon release of the announcement in relation to the transaction; (iii) upon despatch of the shareholders’ circular; and (iv) upon completion of the transaction.

For provision of compliance advisory services, we generally charge our clients a fixed monthly advisory fee which is payable monthly or quarterly for providing compliance advisory services in accordance with the compliance adviser agreement and the relevant requirements under the Main Board Listing Rules or the GEM Listing Rules, as the case may be. The compliance advisory fee is determined with reference to the expected time spent by us and the required manpower during the service period.

Internal Control and Operation Procedures

We are committed to conducting our business in accordance with the laws, rules and policies issued or endorsed by regulators, best market practice and the highest standards of integrity. Pursuant to the Code of Conduct by HKSFC, a licensed corporation should have internal control in place to protect its operations, clients and other licensed or registered persons from financial loss arising from theft, fraud and other dishonest acts, professional misconduct or omissions.

We have implemented compliance and internal control policies, guidelines, and procedures throughout our operation and project execution. Our management and our compliance officer, are responsible for overseeing the management of our compliance risk and monitoring our overall compliance according to our internal control policies, operational guidelines and procedures, and applicable regulatory requirements and reporting in this regard to our senior management from time to time. Our compliance officer will also assist and advise our management from time to time on the management of our compliance risk and on updates in the regulatory environment.

To ensure the efficient implementation of our compliance and risk management system and internal control policy and our daily operation and project execution to be conducted in a compliant way, we have implemented the “manager(s)-in-charge” policy as required by our license. In which, we will appoint the senior members of our staff to be the “manager(s)-in-charge” of one or several of the core functions of our operation, being: (i) overall management oversight; (ii) key business line; (iii) operational control and review; (iv) risk management; (v) finance and accounting; (vi) information technology; (vii) compliance; and (viii) anti-money laundering and counter-terrorist financing. The “manager(s)-in-charge” are expected to actively participate in or are responsible for directly supervising our business of regulated activities, and are responsible for managing the respective function(s), decision making and reporting directly to the board of directors. Through implementing the “manager(s)-in-charge” system, we believe we can ensure the maintenance of appropriate standards of conduct and adherence to proper procedures during our daily course of operation and projects execution.

Our key internal control and operation procedures are as follows.

Engagement assessment and project approval

Know-your clients (KYC)

Before we enter into an engagement with our client for a project, our project execution team will perform the preliminary due diligence work on the client, which include but not limited to: performing site visits to the major operations of the client, preparing KYC questionnaire and document request list and reviewing the information and documents provided by the client, conducting conflicts and independence checking based on the information and documents provided by and discussion with the management of the client, and performing background check through publicly available sources such as the Internet and Stock Exchange filings check on the new client. As a general rule, we are obliged to establish and verify the true and full identity of each client, including the identity of its beneficial owners, financial situation, the nature of their business, their shareholding structure, and their controlling shareholders. The information will be documented and kept in the file.

Anti-money laundering and counter-terrorist financing

We are firmly committed to complying fully with all applicable laws and regulations in relation to the prevention of money laundering and terrorist financing. For the purpose of detecting and preventing money laundering and counter-terrorist financing activities, we have operational guidelines and policies to establish appropriate procedures in compliance with relevant legal and regulatory requirements, in particular, the Guideline on Anti-Money Laundering and Counter-Terrorist Financing issued by the HKSFC, as amended, supplemented or otherwise modified from time to time. In addition to our KYC procedures discussed above, we will also conduct enhanced due diligence measures on all persons who are classified as a high risk for money laundering or terrorist financing, such as politically exposed persons.

We also keep track of information published by international authorities and organizations for the names and particulars of terrorist suspects and designated parties. We screen new clients against current terrorist and sanction designations at the establishment of the relationship and thereafter when new sanction lists are published. Our employees must report any transactions or relationships they have or have had with any named individual or entities to our senior management who would then report the same to the Joint Financial Intelligence Unit, the JFIU. We also monitor the transaction and clients on an ongoing basis to ensure that the transactions are consistent with our knowledge of our client’s information, including business background and risk profile and, where appropriate, source of funds.

We maintain a record-keeping system. All records on transactions, both domestic and international, will be maintained for at least seven years after the completion of a transaction, regardless of whether the business relationship ends during the period.

Appropriate and adequate training on anti-money laundering and counter-terrorist financing is provided to our personnel on an ongoing basis, ensuring they understand the appropriate policies and procedures in this area.

Engagement assessment and project approval

Generally, in assessing a potential engagement, we will consider a variety of factors including but not limited to whether the transaction would comply with applicable rules and regulations, the prevailing market and economic conditions, expected view and opinion from regulators on the transaction, and our available resources. For listing sponsorship project, the preliminary listing suitability of the client will also be assessed. The aforesaid KYC documents and report, after review by our execution team leader, will be submitted to our risk management unit, comprising our Directors, compliance officer, and the Responsible Officers, for discussing whether we should proceed with our engagement based on our professional judgment. Only when no material negative factor is identified during the assessment process, our risk management unit would recommend to proceed with the engagement. Upon receiving the opinion of our risk management unit to proceed, our engagement committee, comprising our Directors, will sign the mandate to confirm our engagement with the client.

Project Execution

Execution Procedures

The execution for our corporate finance advisory services generally include but are not limited to (depending on the nature of our services): (i) performing detailed due diligence, the scope of which depends on the size and complexity of the business operations, such as visiting facilities of business of the client, conducting interviews and meetings with the client’s management, key personnel, and clients and suppliers; (ii) advising the client on compliance with the relevant regulatory requirements, together with other professional parties; (iii) assisting the client in negotiating and advising on the terms and conditions of the proposed transaction; (iv) coordinating the work of professional parties and seeking advice from experts on compliance of rules and requirements applicable to different industries or jurisdictions, if applicable; (v) supervising the preparation of and reviewing all the required documentation; (vi) submission of the required documentation to the Stock Exchange and the HKSFC and liaising with them for the purposes of vetting, clearance and/or publication, if required; (vii) liaising with relevant regulatory authorities for the clearance and/or publication of relevant prospectuses, announcements, circulars and other documents as required.

Our project execution team, led by the team leader, will conduct a comprehensive review on the transaction documents and on the client’s corporate, legal and financial matters to ensure that these transaction documents are accurate and complete, without any material misstatements or omissions, and comply with the relevant listing requirements or applicable rules and regulations. Internal meetings will be held from time to time between our Responsible Officers or principals in charge of the transaction and our execution team, during which reports regarding the transaction will be made to the Responsible Officers or principals for their review and comments. Queries or recommendations raised by the responsible officers or principals will then be addressed by the execution team.

Conflicts of interest

We have policies and procedures that restrict our personnel from inappropriately sharing sensitive clients and counterparty information. The Responsible Officers who possess inside information and confidential information are responsible for releasing necessary information to our personnel on a strictly ‘‘need to know’’ basis.

Where our personnel have a material interest in a transaction with a client or a relationship which gives rise to an actual or potential conflict of interest in relation to the transaction, the personnel should neither advise, nor deal with the transaction unless he has disclosed that material interest or conflict to the client and obtained approval from the respective Responsible Officer. Once approved, our personnel should take all steps to ensure fair treatment of the client. Our personnel is required to take all reasonable steps to avoid situations that are likely to involve conflicts of interest. He must not place his interest above his clients’ interest and has to withdraw from or decline to accept the transaction where he has a material conflict. To avoid conflicts of interest, our personnel and the directors are required to provide a written declaration of interest and independence before we are engaged in the proposed transactions.

Staff dealing

In addition to our policy for conflicts of interest as set out above, our personnel is required to strictly follow our internal policy on personnel dealing, which may give rise to conflicts of interest between our personnel, our Group and our clients. Our personnel must ensure that their personal business, investment, and other activities (including those of family and other close associates) do not influence their judgment or action in relation to their employment duties.

Our personnel are not allowed to trade securities of companies to which we provide corporate finance advisory services until termination or completion of the services or until we cease to hold inside information (as the case may be). All personal dealing accounts held by our personnel must be approved by our management and our compliance team. Annual declaration of these personal dealing accounts is required. The annual declaration will be circulated to all personnel after the end of each year which must be completed and returned to the compliance team within one month. Our compliance officer is also responsible for monitoring all personnel dealings on a regular basis to detect any irregularity and assess whether personnel dealings are prejudicial to our interests and those of our clients.

Completion and Post-Completion

Upon completion of the corporate finance advisory projects, all of our internal records and files must be retained in accordance with our internal control policy and the relevant laws and regulations, including those relating to all due diligence conducted in preparation for application for listing (in case of listing sponsorship projects). Such records must be made available to the regulators on request.

We will regularly oversee our clients’ compliance with relevant rules and regulations, internal controls, corporate governance, disclosure matters and other obligations, particularly our clients of listing sponsorship and compliance advisory during a post-listing continuous supervision period. We have established detailed internal guidelines on the continuous supervision of our listed clients. To ensure strict compliance with the applicable rules and regulations and our internal guidelines, we have prepared various documentation templates to standardize our supervision practices. If any particular issue is identified during the continuous supervision period, our execution team will submit a report to our responsible officers and principals for discussion and further action.

Other Controls Areas

License and qualification of Red Solar and our personnel

We ensure from time to time that Red Solar and our personnel engaging in the provision of corporate finance services have obtained and maintained effective license under the SFO to carry out Type 1 (Dealing in securities) and Type 6 (Advising on corporate finance) regulated activities. In compliance with the sponsor regime of the HKSFC, we, at all times, also maintain at least two principals and we maintained our eligibility to act as sponsors. Directors of the corporate finance unit of Red Solar who have been licensed as responsible officers and have (i) at least five years of relevant and recent corporate finance experience on a continuous basis; and (ii) played a substantial role in at least two completed IPOs on the Main Board or GEM could meet the requirement of the HKSFC to act as principals for carrying out the role of sponsor in IPOs.

FRR

We are required to maintain at all times the liquid capital which is not less than the minimum requirement as set out under the FRR. Our accounts department is responsible for the preparation of the financial returns and the computation of liquid capital in accordance with the requirements under the FRR. The monthly financial returns are submitted to our relevant responsible officers for review and approval before submission to the HKSFC no later than three weeks after each calendar month. Our finance and accounts department also conducts the liquid capital computation on a regular basis which is reviewed by our responsible officers to ensure that we are able to comply with the FRR requirement on an ongoing basis. For years ended June 30, 2023 and 2022, we did not have any material non-compliance with the minimum liquid capital requirement as set out by the HKSFC.

Complaints received

During the years ended June 30, 2023 and 2022 and up to the date of this prospectus, we had not received any material complaints from our clients about us or our employees and there had not been any material non-compliance by us of the requirements under the SFO and guidelines provided by the HKSFC.

Our Clients

The clients of our corporate finance advisory services mainly comprise listing applicants and listed companies in Hong Kong and their respective shareholders, as well as private companies and investors. The clients of our (i) listing sponsorship services are private companies seeking a listing on the Mainboard or GEM board of the Stock Exchange; (ii) financial advisory services are either private companies or listed companies on the Stock Exchange; (iii) securities related services; (iv) independent financial advisory; and (v) compliance advisory services are listed companies on the Stock Exchange.

We had a concentration of revenues of 75.4% and 67.7% from the top five clients for the years ended June 30, 2023 and 2022, respectively. The following table outlines the concentration of each of the top five clients compared to our total revenues.

For the fiscal year ended June 30, 2023:

For the fiscal year ended June 30, 2022:

Sales & Marketing

Our sales and marketing function is primarily performed by our senior managements who are responsible for maintaining relationship with the management of listed companies, developing new clients, and maintaining relationships with professional parties partners in the financial services industry. Our projects generally originate from the networks of our executive Directors and our project execution team, referrals from existing clients or other professional parties and direct approaches by clients due to our market reputation or previous business relationships. We also sponsor congratulatory advertisements on newspapers for listing exercises upon completion of our listing sponsorship and/or underwriting projects. We maintain a company website which showcases our completed projects.

Competition

The Hong Kong corporate finance advisory industry is highly competitive due to the vast number of market players. As of December 31, 2022, there were approximately 308 licensed corporations and 29 registered institutions for Type 6 (advising on corporate finance) regulated activity, and approximately 1,492 licensed corporations and 111 registered institutions for Type 1 (dealing in securities) regulated activity. For details of the competitive landscape of the financial service industry in Hong Kong and the market drivers, see ‘‘Industry’’.

We face keen competition in provision of corporate finance advisory services in Hong Kong. Apart from the indirect competition with the large multinational or China-based financial services companies, we also face the direct competition from local small and medium-sized financial services firms which offer similar range of services.

Among the 127 active licensed sponsors in Hong Kong licensed under the SFO as of May 1, 2023, 81 are considered by our Directors as the large multinational or China-based financial services companies. These financial institutions, such as multinational or China-based investment banks and universal banks, possess more types of licenses in Hong Kong or overseas, which allow these institutions to engage in more types of financial services than us. For example, some of these financial services groups may provide more integrated financial services, in addition to listing sponsorship services, including securities dealing and brokerage, margin financing, derivatives, asset management, and/or commercial and retail banking services. Our Directors believe that, due to the substantial differences in the scale of operation, types of services provided, and target customers, these large multinational or China-based financial services companies are not our direct competitors.

We consider ourselves operating our corporate finance advisory services on a boutique scale, as one of the 46 remaining small and medium-sized active licensed sponsors and financial services firms locally in Hong Kong. We face direct and keen competition with the other local or newly established small and medium-sized financial services firms in Hong Kong, which offer similar range of services as us. For the fact there are large pool of participants within the corporate finance advisory business, our Directors believe that it is not practical to ascertain the competitive position of our Group from the information available, in terms of market share in the corporate finance advisory industry. In terms of size of operation, judged by the numbers of Responsible Officers and Licensed Representatives, as of May 1, 2023, the 46 small and medium-sized financial services firms have staff sizes from nil to 10 Responsible Officers and from nil to 21 Licensed Representatives, while we have 3 Responsible Officers and 3 Licensed Representatives, being one of the 21 small and medium-sized financial services firms out of the 46 which have at least 3 Responsible Officers and 3 Licensed Representatives. Meanwhile, for the years of 2019, 2020, and 2021, in aggregate, 118 listing cases in Stock Exchange are completed by the 46 small and medium-sized financial services firms, including us. Among these firms, the number of completed listing cases ranged from nil to 11, while we completed 2 listing cases, being one of the 20 small and medium-sized financial services firms out of the 46 which have at least completed 2 listing cases for the years of 2019, 2020, and 2021.

Further, due to the boutique scale of our operation, we rely on a limited number of key customers for our business and we are subject to significant client concentration risk. For the years ended June 30, 2023 and 2022, our top five clients accounted for 75.4% and 67.7% of our total revenues and our largest client accounted for 45.2% and 18.9% of our total revenue, respectively. Our client concentration risk is exacerbated due to our reliance on different clients, for different services engaged in different periods, and the fact that the revenue from our corporate finance advisory business was generated on a project-by-project basis and is non-recurring in nature. For example, our largest client for the year ended June 30, 2023 engaged us for our securities related services, and our largest client for the year ended June 30, 2022 engaged us for our listing sponsorship services. Since our listing sponsorship services and financial and compliance advisory services are non-recurring in nature, there is no assurance that we can continue to secure the engagements comparable to the similar level as year ended June 30, 2023 in the future. There is also no assurance that the clients who have previously sought our services will continue to retain us for future business, and there is no assurance that we can continue to secure our engagements in the future. If we are unable to continuously secure new sizable mandates, or if the market conditions become unfavorable, our business and the results of operations may be materially and adversely affected. See “ Risk Factors — Risks Relating to our Business and Operation — We rely on a limited number of key clients for our business, therefore, we are subject to significant client concentration risk.” on page 36, and “ Risk Factors — Risks Relating to our Business and Operation — Our revenue and profitability are highly unpredictable, since (i) the revenue from our corporate finance advisory business was generated on a project-by-project basis and is non-recurring in nature; (ii) progress-based payment arrangement; and (iii) possible default or delay of payments from our clients.” on page 37, for the detailed discussion of our customers concentration risks.

REGULATIONS

Overview

Our operations are subject to various laws and regulations in Hong Kong where we operate. This section sets out summaries of certain aspects of Hong Kong laws and regulations which are relevant to our Group’s operations and business.

Licensing and Registration under the SFO Administered by the HKSFC

The HKSFC

The HKSFC is an independent statutory body set up in 1989 to regulate Hong Kong’s securities and futures markets. It operates independently of the Government of Hong Kong, and is funded mainly by transaction levies and licensing fees.

The HKSFC derives its investigative, remedial and disciplinary powers from the SFO and the subsidiary legislations thereunder. The SFO, in particular, vested the HKSFC with multiple roles and sets out its regulatory objectives, including:

i.       to maintain and promote the fairness, efficiency, competitiveness, transparency and orderliness of the securities and futures industry;

ii.      to promote understanding by the public of financial services including the operation and functioning of the securities and futures industry;

iii.     to provide protection for members of the public investing in or holding financial products;

iv.      to minimise crime and misconduct in the securities and futures industry;

v.       to reduce systemic risks in the securities and futures industry; and

vi.     to assist the Financial Secretary of Hong Kong in maintaining the financial stability of Hong Kong by taking appropriate steps in relation to the securities and futures industry.

The HKSFC is one of the four financial regulators in Hong Kong charged with oversight of finance and investing, but it is the only Hong Kong financial regulator that is given the mandate to educate the investing public. Following the enactment of the Securities and Futures (Amendment) Ordinance 2012, the Investor Education Centre (now known as the Investor and Financial Education Council) was formed as a HKSFC subsidiary to educate the public on a broad range of retail financial products and services.

Who the HKSFC regulates

The HKSFC regulates the following participants, including investors, in the securities and futures market in achieving the regulatory objectives under the SFO:

•        Brokers, investment advisers, fund managers and intermediaries carrying out the regulated activities as listed in ‘‘Types of regulated activities’’ below

•        Investment products

•        Listed companies

•        SEHK

•        Automated trading service providers

•        Approved share registrars

•        Investor Compensation Company Limited

•        Market participants (including investors)

Licensing regime under the SFO

Overview of licensing regime

Generally, the SFO provides that a corporation which is not an authorised financial institution (as defined in section 2(1) of the Banking Ordinance) and is (i) carrying on a business in a regulated activity (or holding out as carrying on a business in a regulated activity); or (ii) actively marketing (whether in Hong Kong or from a place outside Hong Kong) to the public any services it provides, which would constitute a regulated activity if provided in Hong Kong, has to be licensed by the HKSFC to carry out that regulated activity, unless one of the exemptions under the SFO applies.

In addition, an individual performing a regulated function (meaning any function performed for or on behalf of or by arrangement with the person relating to the regulated activity, other than work ordinarily performed by an accountant, clerk or cashier) for the principal which is a licensed corporation in relation to a regulated activity carried on as a business has to be licensed separately under the SFO as a Licensed Representative accredited to the principal.

For each regulated activity conducted by a licensed corporation, it must appoint no less than two Responsible Officers, at least one of them must be an executive director, to supervise the business of such regulated activity. As defined in section 113(1) of the SFO, ‘‘executive director’’, in relation to a licensed corporation, means a director of the corporation who (i) actively participates in; or (ii) is responsible for directly supervising the business of a regulated activity for which the corporation is licensed. All the executive director(s) must seek the HKSFC’s approval as Responsible Officer(s) accredited to the licensed corporation.

The same individual could apply to be a Responsible Officer for more than one regulated activity simultaneously provided that he/she meets the fit and proper (including competence) requirements for the regulated activity concerned, and demonstrate that there is no conflict of interest for he/she to carry on the regulated activities concurrently. In addition, the same individual could apply to be a Responsible Officer for more than one licensed corporation simultaneously provided that he/she can demonstrate there is no conflict of interest.

It is an offence for a person to conduct any regulated activity without the required licence.

Types of regulated activities

Schedule 5 to the SFO stipulates 10 types of regulated activities, namely:

•        Type 1: Dealing in securities

•        Type 2: Dealing in futures contracts

•        Type 3: Leveraged foreign exchange trading

•        Type 4: Advising on securities

•        Type 5: Advising on futures contracts

•        Type 6: Advising on corporate finance

•        Type 7: Providing automated trading services

•        Type 8: Securities margin financing

•        Type 9: Asset management

•        Type 10: Providing credit rating services

As of the date of this prospectus, our Group is licensed for and carried on Type 1 and Type 6 of the above regulated activities. The foregoing licenses of our Group have no expiry date and remain in force until suspended or revoked, subject to certain continuing obligations, such as payment of annual fee and submission of annual return.

Types of intermediary and licensed individual

The types of intermediaries regulated by the HKSFC comprise the following:

i.       Licensed corporation

•        Full licensed corporation:    A corporation (that is not an authorised financial institution) which is granted a licence to carry on one or more regulated activities under section 116 of the SFO.

•        Temporary licensed corporation:    A corporation (that is not an authorised financial institution) which is granted a temporary licence to carry on, for a period not exceeding three months, one or more regulated activities (other than Type 3 (leveraged foreign exchange trading), Type 7 (providing automated trading services), Type 8 (securities margin financing) and Type 9 (asset management)) under section 117 of the SFO.

ii.      Registered institution

An authorised financial institution which is registered to carry on one or more than one regulated activity, other than Type 3 (leveraged foreign exchange trading) and Type 8 (securities margin financing) regulated activities, under section 119 of the SFO.

iii.     Responsible Officer

A Licensed Representative who is also approved as a Responsible Officer under section 126 of the SFO to supervise the regulated activity of the licensed corporation to which he/she is accredited.

iv.      Licensed representative

•        Full Licensed Representative:    An individual who is granted a licence under section 120(1) of the SFO to carry on one or more regulated activities for a licensed corporation to which he/she is accredited.

•        Provisional Licensed Representative:    An individual who is granted a provisional licence under section 120(2) of the SFO to carry on one or more regulated activities for a licensed corporation to which he/she is accredited (prior to the grant of her/his licence under section 120(1) of the SFO).

•        Temporary Licensed Representative:    An individual who is granted a temporary licence under section 121 of the SFO to carry on, for a period not exceeding three months, one or more regulated activities for a corporation licensed under section 116 or 117 of the SFO to which he/she is accredited.

Licensing requirements

Fit and proper requirements

Section 116(3) of the SFO provides that the HKSFC shall refuse to grant a licence to carry on a regulated activity unless the applicant for licence satisfies the HKSFC that, inter alia, the applicant is a fit and proper person to be licensed for the regulated activity. The applicant must remain fit and proper at all times after the grant of such licences by the HKSFC.

In simple terms, a fit and proper person means one who is financially sound, competent, honest, reputable and reliable. Pursuant to section 129(1) of the SFO, in considering whether a person, an individual, corporation or institution, is fit and proper for the purpose of licensing or registration, the HKSFC shall, in addition to any other matter that the HKSFC may consider relevant, have regard to the following:

•        financial status or solvency;

•        educational or other qualifications or experience having regard to the nature of the functions to be performed;

•        ability to carry on the regulated activity concerned competently, honestly and fairly; and

•        reputation, character, reliability and financial integrity of the applicant and other relevant persons as appropriate.

The above fit and proper criteria serve as the fundamental basis when the HKSFC considers each licence or registration application. Detailed guidelines are contained in the Fit and Proper Guidelines, the Licensing Handbook and the Guidelines on Competence issued by the HKSFC.

The Fit and Proper Guidelines apply to a number of persons including the following:

•        an individual who applies for licence or is licensed under Part V of the SFO;

•        a Licensed Representative who applies for approval or is approved as a Responsible Officer under Part V of the SFO;

•        a corporation which applies for licence or is licensed under Part V of the SFO;

•        an authorised financial institution which applies for registration or is registered under Part V of the SFO;

•        an individual whose name is to be or is entered in the register maintained by the Hong Kong Monetary Authority under section 20 of the Banking Ordinance; and

•        an individual who applies to be or has been given consent to act as an executive director of a registered institution under section 71C of the Banking Ordinance.

Section 129(2) of the SFO empowers the HKSFC to take into consideration any of the following in considering whether a person is fit and proper:

(i)     decisions made by such relevant authorities as stated in section 129(2)(a) of the SFO in respect of that person;

(ii)    in the case of a corporation, any information relating to (i) any other corporation within the same group of companies; or (ii) any substantial shareholder or officer of the corporation or of any of its group companies;

(iii)   in the case of a corporation licensed under section 116 or 117 of the SFO or registered under section 119 of the SFO or an application for such licence or registration, (i) any information relating to any other person who will be acting for or on its behalf in relation to the regulated activity; and (ii) whether the person has established effective internal control procedures and risk management systems to ensure its compliance with all applicable regulatory requirements under any of the relevant provisions;

(iv)   in the case of a corporation licensed under section 116 or 117 of the SFO or an application for the licence, any information relating to any person who is or to be employed by, or associated with, the person for the purposes of the regulated activity; and

(v)    the state of affairs of any other business which the person carries on or proposes to carry on.

The HKSFC is obliged to refuse an application to be licensed if the applicant fails to satisfy the HKSFC that the applicant is a fit and proper person to be licensed. The onus is on the applicant to prove to the HKSFC that the applicant is fit and proper to be licensed for the regulated activity.

Licensed corporation

For application as a licensed corporation, the applicant has to be incorporated in Hong Kong or an overseas company registered with the Companies Registry of Hong Kong and the licensed corporation has to satisfy the HKSFC that it has proper business structure, good internal control systems and qualified personnel to ensure the proper management of risks that it will encounter in carrying on the proposed regulated business as detailed in the business plan submitted to the HKSFC. Detailed guidelines to meet the requirements and expectations of the HKSFC are contained in the following documents issued by the HKSFC:

•        the Guidelines on Competence;

•        the Code of Conduct;

•        Management, Supervision and Internal Control Guidelines for Persons Licensed by or Registered with the HKSFC;

•        the Fit and Proper Guidelines;

•        the Corporate Finance Adviser Code of Conduct published by the HKSFC in October 2013 (the “CFA Code”); and

•        the Fund Manager Code of Conduct published by the HKSFC in November 2018.

Responsible Officer