《恒光保险(HGIA)美股IPO招股说明书(更新版)(270页).pdf》由会员分享,可在线阅读,更多相关《恒光保险(HGIA)美股IPO招股说明书(更新版)(270页).pdf(270页珍藏版)》请在三个皮匠报告上搜索。
1、2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm1/270F-1/A 1 formf-1a.htmAs filed with the U.S.Securities and Exchange Commission on November 18,2022.Registration No. UNITE
2、D STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549 Amendment No.8toFORM F-1REGISTRATION STATEMENTUNDERTHE SECURITIES ACT OF 1933 HENGGUANG HOLDING CO.,LIMITED(Exact name of registrant as specified in its charter)Not Applicable(Translation of Registrants name into English)Cayman Islands 6
3、411 Not Applicable(State or other jurisdictionof incorporation or organization)(Primary Standard IndustrialClassification Code Number)(I.R.S.EmployerIdentification Number)1666 Chenglong Road,Section 2,Building 2,5th FloorLongquanyi District,Chengdu,Sichuan Province,China 61000c/o Jiulin Zhang+86(400
4、)028-1990(Address,including zip code,and telephone number,including area code,of registrants principal executive offices)Sichenzia Ross Ference LLP1185 Avenue of the Americas,31st FloorNew York,New York 10036(212)930-9700(Name,address,including zip code,and telephone number,including area code,of ag
5、ent for service)Copies to:Jay Kaplowitz,Esq.Huan Lou,Esq.Sichenzia Ross Ference LLP1185 Avenue of the Americas,31st FloorNew York,New York 10036Telephone:(212)930-9700Fang Liu,Esq.VCL Law LLP1945 Old Gallows Road,Suite 630Vienna,VA 22182Telephone:(703)919-7285 Approximate date of commencement of pro
6、posed sale to the public:Promptly after the effective date of this registrationstatement.If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415under the Securities Act of 1933 check the following box.X If this Form is filed to r
7、egister additional securities for an offering pursuant to Rule 462(b)under the Securities Act,pleasecheck the following box and list the Securities Act registration statement number of the earlier effective registration statement for2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0001493152
8、22032841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm2/270the same offering.If this Form is a post-effective amendment filed pursuant to Rule 462(c)under the Securities Act,check the following box andlist the Securities Act registration statement number
9、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 andlist the Securities Act registration statement number of the earlier effective registration statement for
10、the same offering.Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of1933.Emerging growth company X If an emerging growth company that prepares its financial statements in accordance with U.S.GAAP,indicate by check markif the re
11、gistrant has elected not to use the extended transition period for complying with any new or revised financial accountingstandards provided pursuant to Section 7(a)(2)(B)of the Securities Act.The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay
12、itseffective date until the Registrant shall file a further amendment which specifically states that this registration statementshall thereafter become effective in accordance with Section 8(a)of the Securities Act of 1933,as amended,or until theregistration statement shall become effective on such
13、date as the Securities and Exchange Commission,acting pursuant tosuch Section 8(a),may determine.2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm3/270 The information in this prospec
14、tus is not complete and may be changed.We may not sell these securities until theregistration statement filed with the Securities and Exchange Commission is effective.This prospectus is not an offer to sellthese securities and it is not soliciting an offer to buy these securities in any state where
15、the offer or sale is not permitted.SUBJECT TO COMPLETION PRELIMINARY PROSPECTUSDATED November 18,2022 4,000,000 Class A Ordinary Shares HENGGUANG HOLDING CO.,LIMITED This is an initial public offering of the Class A Ordinary Shares of Hengguang Holding Co.,Limited(“Heng Guang Cayman”),aholding compa
16、ny incorporated in the Cayman Islands.Prior to this offering,there has been no public market for Heng GuangCaymans Class A ordinary shares,par value$0.001 per share(the“Class A Ordinary Share”).This offering is being made on afirm commitment basis.We expect the initial public offering price will be$
17、4.00 per share.We reserved the symbol“HGIA”forpurposes of listing the Class A Ordinary Shares on the Nasdaq Stock Market(“NASDAQ”)and applied to list the Class AOrdinary Shares on the Nasdaq Capital Market.The initial public offering is contingent upon receiving authorization to list theClass A Ordi
18、nary Shares on NASDAQ.There is no guarantee or assurance that the Class A Ordinary Shares will be approved forlisting on NASDAQ.There are 6,500,000 Class A Ordinary Shares and 3,500,000 Class B ordinary shares(the“Class B Ordinary Shares”)issued andoutstanding immediately prior to this offering.In r
19、espect of matters requiring the votes of shareholders,each Class A OrdinaryShare is entitled to one vote,and each Class B Ordinary Share is entitled to ten(10)votes and is convertible into one Class AOrdinary Share at any time requested by the holder thereof.Class A Ordinary Shares are not convertib
20、le into Class B OrdinaryShares under any circumstances.The holders of our Class B Ordinary Shares will be able to exercise approximately 77%of thetotal outstanding voting power immediately following the completion of this offering,assuming the sale of 4,000,000 Class AOrdinary Shares and excluding t
21、he effects of any exercise of the Underwriter Warrants and the over-allotment option.Our officers and directors of Heng Guang Cayman own and will continue to own at least 50%of the voting power of Heng GuangCayman after the closing of this offering,therefore Heng Guang Cayman is a“controlled company
22、”as defined under NASDAQListing Rules.However,even if Heng Guang Cayman qualifies as a“controlled company,”it does not intend to rely on thecontrolled company exemptions provided under NASDAQ Listing Rules.Investing in our Class A Ordinary Shares involves a high degree of risk,including the risk of
23、losing your entire investment.See“Risk Factors”starting on page 22 to read about factors you should consider before buying the Class A OrdinaryShares.Heng Guang Cayman is not a Chinese operating company but a holding company incorporated in the Cayman Islands.This is anoffering of the ordinary share
24、s of Heng Guang Cayman,the offshore holding company.You are not investing in any of theAffiliated Entities.“Heng Guang Insurance”or the“VIE”shall hereinafter refer to Sichuan Heng Guang Insurance Agency Co.,Ltd.,a company organized under the laws of the PRC and the operating entity,which has entered
25、 into a series of variable interestentity agreements(the“VIE Agreements”)with WFOE(as defined below),an indirect subsidiary of Heng Guang Cayman.“HengGuang BVI”shall hereinafter refer to Heng Guang Shun Da Co.,Ltd.,a company formed under the laws of British Virgin Islandsand a wholly-owned subsidiar
26、y of Heng Guang Cayman.“Heng Guang Hong Kong”shall hereinafter refer to Heng GuangHoldings Co.,Ltd.,a company formed under the laws of Hong Kong and a wholly-owned subsidiary of Heng Guang BVI.“WFOE”shall hereinafter refer to Chengdu Jiulin Kefu Technology Co.,Ltd.,a Chinese company and wholly-owned
27、 subsidiary ofHeng Guang Hong Kong.“We,”the“Company”or the“Group”shall refer to the group of Heng Guang Insurance,Heng GuangCayman,Heng Guang BVI,Heng Guang Hong Kong,and the WFOE.The“Affiliated Entities”shall refer to Heng Guang BVI,Heng Guang Hong Kong,WFOE,and Heng Guang Insurance.2022/12/13https
28、:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm4/270As a holding company with no material operations of its own,Heng Guang Cayman conducts substantially all of its operationsthrough Heng Guang Ins
29、urance,the operating entities established in the PRC,which has entered into the VIE Agreements withWFOE.See“Prospectus Summary-Contractual Arrangements Between Heng Guang Insurance And WFOE.”Neither HengGuang Cayman nor its subsidiaries own any share in Heng Guang Insurance,which are hereinafter ref
30、erred to as the“VIE.”Thecontractual arrangements with respect to the VIE and WFOE are not equivalent to an equity ownership in the business of the VIEand the investors may never hold equity interests in Heng Guang Insurance unless the VIE Agreements are replaced with the directownership of Heng Guan
31、g Insurance by the WFOE.Instead,for accounting purposes,Heng Guang Cayman is the primarybeneficiary of Heng Guang Insurances business operations through the VIE Agreements,which enables us to consolidate thefinancial results of the VIE in our consolidated financial statements under U.S.GAAP.We have
32、evaluated the guidance inFinancial Accounting Standards Board Accounting Standards Codification 810 and determined that we are regarded as the primarybeneficiary of the VIE for accounting purposes,as a result of our direct ownership in the WFOE and the provisions of the VIEAgreements.The VIE Agreeme
33、nts or the contractual structure is used to provide non-Chinese investors with exposure to foreigninvestment in China-based companies where Chinese laws impose certain restrictions on foreign ownership over such companiesof certain categories.Consequently,the Company consolidates the accounts of VIE
34、 for the periods presented.Any references tocontrol or benefits that accrue to Heng Guang Cayman because of the VIE Agreements are limited to,and subject to conditions wehave satisfied for consolidation of the VIE under U.S.GAAP.The VIE is consolidated for accounting purposes but is not an entityin
35、which Heng Guang Cayman owns equity.Heng Guang Cayman does not conduct any active operations and is the primarybeneficiary of the VIE for accounting purposes only.In addition,the contractual agreements with the VIE have not been tested in court in China and this structure involves unique risksto inv
36、estors.For example,the PRC government could disallow the VIE Arrangements,which would likely result in a materialchange in the Groups operations and structure and significant change in the value of the securities Heng Guang Cayman isregistering for sale,including it could cause the value of such sec
37、urities to significantly decline or become worthless.See“RiskFactorsRisks Relating to Doing Business in China.”Heng Guang Caymans Class A Ordinary Shares offered in this prospectus are shares of the company incorporated in CaymanIslands,not the shares of the operating entities.Because of the Groups
38、corporate structure,the Company or Group is subject to therisks due to uncertainty of the interpretation and the application of the PRC laws and regulations.As of the date of this prospectus,there is no laws,regulations or other rules require a China based operating entity to obtain permission or ap
39、provals from anyChinese authorities to list its or the affiliates securities on U.S.stock exchanges,and neither Heng Guang Cayman nor HengGuang Insurance has received or were denied such permission.However,there is no guarantee that Heng Guang Cayman or HengGuang Insurance will receive or not be den
40、ied permission from Chinese authorities to list on U.S.exchanges in the future.For adescription of our corporate structure and VIE contractual arrangements,see“Business-Corporate History and Structure”andalso“Risk Factors-Risks Related to Our Corporate Structure.”In addition,as we conduct substantia
41、lly all of the operations in mainland China,we are subject to legal and operational risksassociated with having substantially all of the operations in mainland China,including risks related to the legal,political andeconomic policies of the Chinese government,the relations between China and the Unit
42、ed States,and changes in Chinese laws andregulations,which could result in a material change in the operations and/or cause the value of our ordinary shares to significantlydecline or become worthless and affect our ability to offer or continue to offer securities to investors.Recently,the PRCgovern
43、ment initiated a series of regulatory actions and made a number of public statements on the regulation of businessoperations in China with little advance notice,including cracking down on illegal activities in the securities market,enhancingsupervision over China-based companies listed overseas,adop
44、ting new measures to extend the scope of cybersecurity reviews,andexpanding efforts in anti-monopoly enforcement.On December 28,2021,thirteen governmental departments of the PRC,including the Cyberspace Administration of China(the“CAC”),issued the Cybersecurity Review Measures,which becameeffective
45、on February 15,2022.The Cybersecurity Review Measures provide that an online platform operator,which possessespersonal information of at least one million users,must apply for a cybersecurity review by the CAC if it intends to be listed inforeign countries.Because the current operations do not posse
46、ss personal information from more than one million users at thismoment,we do not believe that we are subject to the cybersecurity review by the CAC.In addition,as of the date of thisprospectus,we have not been involved in any investigations on cybersecurity review initiated by any PRC regulatory aut
47、hority,norhave we received any inquiry,notice,or sanction related to cybersecurity review under the Cybersecurity Review Measures.As ofthe date of this prospectus,no relevant laws or regulations in the PRC explicitly require us to seek approval from the ChinaSecurities Regulatory Commission(the“CSRC
48、”)or any other PRC governmental authorities for our overseas listing plan,norhave we(including any of our subsidiaries or the VIE)received any inquiry,notice,warning or sanctions regarding our plannedoverseas listing from the CSRC or any other PRC governmental authorities.Also as of the date of this
49、 prospectus,we do notbelieve we are in a monopolistic position in the insurance intermediary industry.In summary,the recent statements and regulatoryactions by Chinas government related to the use of variable interest entities and data security or antimonopoly concerns,have notaffected our ability t
50、o conduct the business,accept foreign investments,or list on a U.S.or other foreign exchange.However,sincethese statements and regulatory actions by the PRC government are newly published and official guidance and relatedimplementation rules have not been issued,it is highly uncertain what the poten
51、tial impact such modified or new laws andregulations will have on our daily business operation,the ability to accept foreign investments and list on a U.S.or non-Chineseexchange.The Standing Committee of the National Peoples Congress(the“SCNPC”)or other PRC regulatory authorities may inthe future pr
52、omulgate laws,regulations or implementing rules that would require Heng Guang Insurance,Heng Guang Cayman orany subsidiaries to obtain regulatory approval from Chinese authorities before listing in the U.S.See“Risk Factors-Risks Relatingto Doing Business in China.”2022/12/13https:/www.sec.gov/Archiv
53、es/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm5/270 In addition,Heng Guang Hong Kong may transfer funds within our corporate group in the future.We think that the legal andoperational risks associated with operating
54、 in mainland China also may apply to Heng Guang Hong Kongs future limited activitiesin Hong Kong,to the extent applicable to the transfers of funds in Hong Kong,if Hong Kong adopts certain rules,regulations orpolicy guidance with respect to currency exchange control.We believe,without in reliance on
55、 the opinion of Hong Kong legalcounsel,that any regulatory actions related to data security or anti-monopoly concerns in Hong Kong may have very minimumimpact or no impact at all on the Companys ability to conduct its business,accept foreign investments,or list on a U.S.or foreignexchange because we
56、 currently do not and do not plan to have any substantive operations,including any data-related operations,inHong Kong and Heng Guang Hong Kong,our only subsidiary in Hong Kong,currently has no operations and is expected to havethe sole function of transferring funds within the corporate group in th
57、e future without playing any other roles in Hong Kong.See“Risk Factors-Risks Relating to Doing Business in China.”Under our current corporate structure,to fund any cash and financing requirements Heng Guang Cayman may have,Heng GuangCayman may rely on dividend payments from its subsidiaries.See“Summ
58、ary Consolidated Financial Data”on page 14.Furthermore,none of Heng Guang Cayman,its subsidiaries,or the VIE has distributed any earnings or settled any amounts owedunder the VIE Agreements,and nor does any of them have any plan to distribute earnings or settle amounts owed under the VIEAgreements i
59、n the foreseeable future.Additionally,the transfer of funds and assets between Heng Guang Cayman and theAffiliated Entities is subject to restrictions.The PRC government imposes controls on the conversion of the RMB into foreigncurrencies and the remittance of currencies out of the PRC.Heng Guang In
60、surance,the PRC operating entity,receives substantiallyall of its revenue in RMB.As such we may convert a portion of Heng Guang Insurances revenue into other currencies to meet theforeign currency obligations,such as payments of dividends,if any.Shortages in the availability of foreign currency may
61、restrictthe ability of Heng Guang Insurance to remit sufficient foreign currency to pay dividends or other payments to Heng GuangCayman.However,there is no assurance that the Chinese government will not,in the future,intervene or impose furtherrestrictions or limitations on Heng Guang Insurances abi
62、lity to transfer cash out of mainland China and Hong Kong.See“RiskFactors-Risks Relating to Doing Business in China.”As of the date of this prospectus,none of Heng Guang Caymanssubsidiaries or the VIE have made any dividends or distributions to Heng Guang Cayman and Heng Guang Cayman has made anydiv
63、idends or distributions to its shareholders.We intend to keep any future earnings to finance the expansion of our business,andwe do not anticipate that any cash dividends will be paid in the foreseeable future.If Heng Guang Cayman determines to paydividends on any of its Ordinary Shares in the futur
64、e,as a holding company,it will be dependent on receipt of funds from HengGuang Hong Kong.Heng Guang Hong Kong will rely on payments made from the WFOE and Heng Guang Insurance pursuant tothe VIE Agreements.As of the date of this prospectus,no cash transfer or transfer of other assets has occurred be
65、tween HengGuang Cayman,any of its subsidiaries,and the VIE.As of the date of this prospectus,none of Heng Guang Cayman,itssubsidiaries,or the VIE has a cash management policy.See“Prospectus Summary-Dividend Distribution.”Our Class A Ordinary Shares may be prohibited from trading on a national exchan
66、ge or“over-the-counter”markets under theHolding 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 tradedmay delist our se
67、curities.Furthermore,on June 22,2021,the U.S.Senate passed the Accelerating Holding Foreign CompaniesAccountable Act(the“AHFCAA”),which,if signed into law,would amend the HFCAA and require the SEC to prohibit anissuers securities from trading on any U.S.stock exchanges if its auditor is not subject
68、to PCAOB inspections for two consecutiveyears 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 accountingfirms headquartered
69、in mainland China and Hong Kong.Our independent registered public accounting firm is headquartered in theState of California and has been inspected by the PCAOB on a regular basis and as such,it is not affected by or subject to thePCAOBs Determination Report.On August 26,2022,the SEC issued a statem
70、ent announcing that the PCAOB signed a Statementof Protocol with the CSRC and the Ministry of Finance of the Peoples Republic of China governing inspections and investigationsof audit firms based in China and Hong Kong,jointly agreeing on the need for a framework.Notwithstanding the foregoing,in the
71、future,if there is any regulatory change or step taken by PRC regulators that does not permit our auditor to provide auditdocumentations located in China to the PCAOB for inspection or investigation,you may be deprived of the benefits of suchinspection which could result in limitation or restriction
72、 to our access to the U.S.capital markets and trading of our securities,including trading on the national exchange and trading on“over-the-counter”markets,may be prohibited under the HFCAA.See“Risk Factors-Risks Relating to Doing Business in China.”Heng Guang Cayman is an“emerging growth company”as
73、used in the Jumpstart Our Business Startups Act of 2012,and as such,Heng Guang Cayman has elected to take advantage of certain reduced public company reporting requirements for this prospectusand future filings.See“Risk Factors”and“Prospectus Summary Implications of Our Being an Emerging Growth Comp
74、any”.Neither the Securities and Exchange Commission nor any state securities commission nor any other regulatory body hasapproved or disapproved of these securities or determined if this prospectus is truthful or complete.Any representation tothe contrary is a criminal offense.Per Class AOrdinary Sh
75、are Total Without Over-Allotment Option Total With Over-Allotment Option Initial public offering price(1)US$4.00 US$16,000,000 US$18,400,000 2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf
76、-1a.htm6/270Underwriters discounts(2)US$0.3 US$1,200,000 US$1,380,000 Proceeds to our company before expenses(3)US$3.70 US$14,800,000 US$17,020,000 (1)Assumed an initial public offering price of$4.00 per share.(2)See“Underwriting”in this prospectus for more information regarding our arrangements wit
77、h the underwriter.(3)The total estimated expenses related to this offering are set forth in the section entitled“Expenses Relating to This Offering”.We expect our total cash expenses for this offering(including cash expenses payable to our underwriter for its out-of-pocketexpenses)to be approximatel
78、y$750,000,exclusive of underwriting discounts and non-accountable expense allowance.In addition,we will pay additional items of value in connection with this offering that are viewed by the Financial Industry RegulatoryAuthority,or FINRA,as underwriting compensation.These payments will further reduc
79、e proceeds available to us before expenses.See“Underwriting.”This offering is being conducted on a firm commitment basis.The underwriter is obligated to take and pay for all of the OrdinaryShares if any such shares are taken.We have granted the underwriter an option for a period of 45 days after the
80、 closing of thisoffering to purchase up to 15%of the total number of our Ordinary Shares to be offered by us pursuant to this offering(excludingshares subject to this option),solely for the purpose of covering over-allotments,at the initial public offering price less theunderwriting discount.If the
81、underwriter exercises the over-allotment option in full,the total underwriting discounts payable willbe$1,380,000 based on an assumed offering price of$4.00 per Class A Ordinary Share,and the total gross proceeds to us,beforeunderwriting discounts and expenses,will be$18,400,000.If we complete this
82、offering,net proceeds will be delivered to us on theclosing date.We will not be able to use such proceeds in China,however,until we complete capital contribution procedures whichrequire prior approval from each of the respective local counterparts of Chinas Ministry of Commerce,the State Administrat
83、ionfor Industry and Commerce,and the State Administration of Foreign Exchange.See remittance procedures in the section titled“Use of Proceeds”beginning on page 42.The underwriter expects to deliver the Class A Ordinary Shares against payment in New York,New York on*,2022.Network 1 Financial Securiti
84、es,Inc.Prospectus dated*,2022 2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm7/270 About this Prospectus This prospectus is part of a registration statement we filed with the SEC.We
85、 and the underwriter have not authorized anyone toprovide any information or to make any representations other than those contained in this prospectus or in any free writingprospectuses prepared by us or on our behalf or to which we have referred you.We take no responsibility for,and can provide noa
86、ssurance as to the reliability of,any other information that others may give you.This prospectus is an offer to sell only theOrdinary Shares offered hereby,but only under circumstances and in jurisdictions where it is lawful to do so.We are not makingan offer to sell these securities in any jurisdic
87、tion where the offer or sale is not permitted or where the person making the offer orsale is not qualified to do so or to any person to whom it is not permitted to make such offer or sale.The information contained inthis prospectus is current only as of the date on the front cover of the prospectus.
88、Our business,financial condition,results ofoperations and prospects may have changed since that date.Other Pertinent Information Unless otherwise indicated or the context requires otherwise,references in this prospectus to:“Affiliated Entities”are to Heng Guang BVI,Heng Guang Hong Kong,WFOE,and Heng
89、 Guang Insurance;“China”or“PRC”are to the Peoples Republic of China,including Hong Kong and Macau;however the only time suchjurisdictions are not included in the definition of PRC and China is when we reference to the specific laws that have beenadopted by the PRC.The same legal and operational risk
90、s associated with operations in China also apply to operations inHong Kong.The term“Chinese”has a correlative meaning for the purpose of this prospectus;“Class A Ordinary Shares”are to our Class A ordinary shares,par value US$0.001 per share;“Class B Ordinary Shares”are to our Class B ordinary share
91、s,par value US$0.001 per share;“Heng Guang Insurance”are to Sichuan Heng Guang Insurance Agency Co.,Ltd.,a company organized under the laws ofthe PRC and the operating entity which has entered into the VIE Agreement with WFOE;“Heng Guang Insurance Shareholders”or“HG Shareholders”are to Chunlin Mao,H
92、aibo Bai,and Xuefeng Huang,collectively,who have constituted all of the shareholders of Heng Guang Insurance as of the date of this prospectus.“Heng Guang Cayman”or the“Company”are to the registrant Hengguang Holding Co.,Limited.,an exempted companyincorporated under the laws of Cayman Islands;“Heng
93、 Guang BVI”are to Heng Guang Shun Da Co.,Ltd.,a company formed under the laws of British Virgin Islandsand a wholly-owned subsidiary of Heng Guang Cayman;“Heng Guang Hong Kong”are to Heng Guang Holdings Co.,Ltd.,a company formed under the laws of Hong Kong and awholly-owned subsidiary of Heng Guang
94、BVI;“shares”,“Shares”or“Ordinary Shares”as of the date hereof refer to our Class A and Class B ordinary shares,par valueUS$0.001 per share;“VIE”are to the variable interest entities including Heng Guang Insurance;“WFOE”are to Chengdu Jiulin Kefu Technology Co.,Ltd.,a Chinese company and wholly-owned
95、 subsidiary of HengGuang Hong Kong;“we”,“us”,the“Company”or the“Group”are to Heng Guang Insurance,Heng Guang Cayman,Heng Guang BVI,HengGuang Hong Kong,and the WFOE,as a group.Our business is conducted by Heng Guang Insurance,the VIE in the PRC,and its branch offices,using Chinese dollars(the“RMB”),t
96、he legal currency of mainland China.Our consolidated financial statements are presented in United States dollars.In thisprospectus,we refer to assets,obligations,commitments and liabilities in our consolidated financial statements in United Statesdollars.These dollar references are based on the exch
97、ange rate of RMB to United States dollars,determined as of a specific date orfor a specific period.Changes in the exchange rate will affect the amount of our obligations and the value of our assets in terms ofUnited States dollars which may result in an increase or decrease in the amount of our obli
98、gations and the value of our assets,including accounts receivable.2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm8/270 TABLE OF CONTENTS PagePROSPECTUS SUMMARY1SUMMARY CONSOLIDATED
99、FINANCIAL DATA14RISK FACTORS22USE OF PROCEEDS42DIVIDEND POLICY43CAPITALIZATION43DILUTION44ENFORCEABILITY OF CIVIL LIABILITIES45MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OFOPERATIONS46INDUSTRY60BUSINESS63REGULATIONS79MANAGEMENT87EXECUTIVE COMPENSATION90PRINCIPAL SHAREHOLD
100、ERS91RELATED PARTY TRANSACTIONS92DESCRIPTION OF SHARE CAPITAL93SHARES ELIGIBLE FOR FUTURE SALE105TAXATION106UNDERWRITING111EXPENSES RELATING TO THIS OFFERING117LEGAL MATTERS117EXPERTS117WHERE YOU CAN FIND MORE INFORMATION117INDEX TO FINANCIAL STATEMENTSF-1 We are responsible for the information cont
101、ained in this prospectus and any free writing prospectus we prepare or authorize.Wehave not,and the underwriter has not,authorized anyone to provide you with different information,and we and the underwritertake no responsibility for any other information others may give you.We are not,and the underw
102、riter is not,making an offer to sellour Ordinary Shares in any jurisdiction where the offer or sale is not permitted.You should not assume that the informationcontained in this prospectus is accurate as of any date other than the date on the front cover of this prospectus,regardless of thetime of de
103、livery of this prospectus or the sale of any Ordinary Shares.For investors outside the United States:Neither we nor the underwriter have done anything that would permit this offering orpossession or distribution of this prospectus in any jurisdiction,other than the United States,where action for tha
104、t purpose isrequired.Persons outside the United States who come into possession of this prospectus must inform themselves about,andobserve any restrictions relating to,the offering of the Ordinary Shares and the distribution of this prospectus outside the UnitedStates.We are incorporated under the l
105、aws of PRC as an exempted company with limited liability and a majority of our outstandingsecurities are owned by non-U.S.residents.Under the rules of the U.S.Securities and Exchange Commission,or the SEC,wecurrently qualify for treatment as a“foreign private issuer.”As a foreign private issuer,we w
106、ill not be required to file periodicreports and financial statements with the Securities and Exchange Commission,or the SEC,as frequently or as promptly asdomestic registrants whose securities are registered under the Securities Exchange Act of 1934,as amended,or the Exchange Act.All dealers that bu
107、y,sell or trade our Ordinary Shares,whether or not participating in this offering,may be required to deliver aprospectus 25 days after this registration agreement is declared effective.This delivery requirement is in addition to the obligationof dealers to deliver a prospectus when acting as underwr
108、iters and with respect to their unsold allotments or subscriptions.2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm9/270 PROSPECTUS SUMMARY The following summary is qualified in its
109、entirety by,and should be read in conjunction with,the more detailed information andfinancial statements included elsewhere in this prospectus.In addition to this summary,we urge you to read the entire prospectuscarefully,especially the risks of investing in our Ordinary Shares,discussed under“Risk
110、Factors,”before deciding whether to buyour Ordinary Shares.Overview Heng Guang Cayman is a holding company incorporated in the Cayman Islands with no material operations.As a holdingcompany with no material operations of its own,Heng Guang Cayman conducts substantially all of the operations through
111、HengGuang Insurance or the VIE,the operating entity established in the Peoples Republic of China,which has entered into a series ofthe VIE Agreements with WFOE,an indirect subsidiary of Heng Guang Cayman.For accounting purposes,Heng Guang Caymanis the primary beneficiary of Heng Guang Insurances bus
112、iness operations through the VIE Agreements,which enables HengGuang Cayman to consolidate the financial results of the VIE in our consolidated financial statements under U.S.GAAP.We haveevaluated the guidance in Financial Accounting Standards Board Accounting Standards Codification 810 and determine
113、d that weare regarded as the primary beneficiary of the VIE for accounting purposes,as a result of our direct ownership in WFOE and theprovisions of the VIE Agreements.“Prospectus Summary-Contractual Arrangements Between Heng Guang Insurance AndWFOE.”Our Class A Ordinary Shares offered in this prosp
114、ectus are shares of Heng Guang Cayman,our holding companyincorporated in Cayman Islands,not the shares of Heng Guang Insurance,the operating entity.The following diagram illustrates our current corporate structure and existing shareholders of each corporate entity listedherein as of the date of this
115、 prospectus:For a detailed description of our corporate structure and VIE contractual arrangements,see“Business-Corporate Historyand Structure”and“Principal Shareholders.”See also“Risk Factors-Risks Related to Our Corporate Structure.”Heng Guang Insurance,which has entered into a set of variable int
116、erest entity agreements with WFOE,was established in2004 and has developed a successful business strategy in the City of Guangan,Sichuan Province during its first ten years.In 2014,Heng Guang Insurance relocated its headquarters to Chengdu,the capital city of Sichuan and a business center in southwe
117、st China.In 2016,Heng Guang Insurance was granted with its mainland Chinese national insurance agency qualification and Internetinsurance agency license,and formally established its corporate strategy of expanding its digital insurance agency services.In2019,Heng Guang Insurance accelerated its digi
118、talization process and began to develop a digital sales application platform-“HengKuai Bao(meaning fast insurance agency)”,aiming to enhance the insurance service efficiency,improve user experiences,andempower its agents with new technologies.In September 2020,after the auto insurance reform in Chin
119、a,Heng Guang Insurancewas a pioneer insurance intermediary in launching the auto insurance one-click system in Heng Kuai Bao,which gained itspopularity in the auto-insurance market.As of June 2022,Heng Guang Insurance grew from one branch office in Guangan City tofifty-four(54)locations sprawling in
120、 sixteen(16)provinces and municipalities in the Southwest and Northeast of the PRC.Thecontractual arrangements with respect to the VIE are not equivalent to an equity ownership in the business of the VIE and the2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmh
121、ttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm10/270investors may never hold equity interests in Heng Guang Insurance unless the VIE Agreements are replaced with the directownership of Heng Guang Insurance by the WFOE.Instead,for accounting purposes,Heng Guang Cayman i
122、s the primarybeneficiary of Heng Guang Insurances business operations through the VIE Agreements,which enables Heng Guang Cayman toconsolidate the financial results of the VIE in our consolidated financial statements under U.S.GAAP.We have evaluated theguidance in Financial Accounting Standards Boar
123、d Accounting Standards Codification 810 and determined that we are regarded asthe primary beneficiary of the VIE for accounting purposes,as a result of our direct ownership in WFOE and the provisions of theVIE Agreements.The VIE is consolidated for accounting purposes but not an entity in which Heng
124、 Guang Cayman owns equity.Heng Guang Cayman does not conduct any active operations and is the primary beneficiary of the VIE for accounting purposes.In addition,the contractual agreements with the VIE have not been tested in court in China and this structure involvesunique risks to investors.For exa
125、mple,the PRC government could disallow the VIE Arrangements,which would likely result in amaterial change in the Groups operations and structure and significant change in the value of the securities Heng Guang Caymanis registering for sale,including it could cause the value of such securities to sig
126、nificantly decline or become worthless.See“RiskFactorsRisks Relating to Doing Business in China.”Heng Guang Insurance distributes a variety of insurance products,which are categorized into two major groups:(1)property and casualty insurance,such as automobile insurance,commercial property insurance,
127、casualty and accident insurance,construction and engineering insurance,and liability insurance;and(2)life and health insurance.As an insurance agency firm,Heng Guang Insurance has limited underwriting capacity and primarily provides sales,distribution and ancillary services ofinsurance products unde
128、rwritten by the insurance companies Heng Guang Insurance represents.Heng Guang Insurance derives itsrevenue primarily from commissions and fees paid by the partner insurance companies,typically calculated as a percentage ofpremiums paid by its customers to the insurance companies.As of the date of t
129、his report,Heng Guang Insurance has relationshipswith over 70 insurance companies in the PRC.Heng Guang Insurance helps consumers select the right insurance products forpurchase,but represent the partner insurance companies in the transactions.For the year ended December 31,2021,61.78%of ourtotal re
130、venue were attributed to our top five insurance company partners,each accounted for 23.74%,13.54%,10.63%,8.97%and4.90%,respectively.For the year ended December 31,2020,70.61%of our total revenue were attributed to our top five insurancecompany partners,each accounted for 30.07%,22.26%,6.88%,6.29%and
131、 5.11%,respectively.For the six months ended June 30,2022,66.73%of our total revenue were attributed to our top five insurance company partners,each accounted for 20.93%,18.04%,10.67%,9.38%and 7.72%,respectively.For the six months ended June 30,2021,61.38%of our total revenues wereattributed to our
132、top five insurance company partners,each accounted for 24.83%,13.78%,12.13%,6.69%and 3.95%,respectively.Please see Section“Business-Customers”for details about our top insurance partners.We sell insurance productsprimarily through our sales force who are individual sales agents in our distribution a
133、nd service network.As of the date of thisprospectus,we had 54 locations or branch offices throughout China to sell the insurance products,including fifty branchescurrently in operation,two with pending insurance agency applications,and two branches incorporated in 2022 with nosignificance operations
134、.A large component of our cost of revenues is commissions paid to our individual sales agents.HengGuang Insurance established eighteen(18)new branch offices in the years 2019 through 2022 to further grow our sales and marketshare.Heng Guang Insurance has its mainland Chinese national insurance agenc
135、y license granted by the China Bank and InsuranceRegulatory Commission(the“CBIRC”),valid as of June 13,2023 and subject to further extension.All of Heng Guang Insurancesfifty operating branches have registered with the CBIRCs insurance agency supervision information system,including twenty fourbranc
136、hes in Sichuan Province,five branches in Zhejiang Province,three branches in Hebei Province,two branches in ChongqingProvince,two branches in Yunnan Province,two branches in Hunan Province,two branches in Gansu Province,two branches inHenan Province,one branch in Jiangxi Province,one branch in Shanx
137、i Province,one branch in Guizhou Province,one branch inShandong Province,one branch in Jiangsu Province,one branch in Liaoning Province,one branch in Jilin Province,and onebranch in Tibet Province.In addition,two of the branches have applied for insurance agency business licenses in ChongqingProvinc
138、e and Hebei Province which are pending from the relevant local authorities as of the date of this prospectus.The Chinese insurance industry has grown substantially in the past decade.Historically,insurance companies in the PRCrelied primarily on their exclusive individual sales agents and direct sal
139、es force to sell their products.However,in recent years,as aresult of increased competition and consumers demand for more options,insurance companies gradually expanded theirdistribution channels to include insurance intermediaries,such as commercial banks and insurance intermediaries.In addition,be
140、cause of the increasingly high costs for establishing and maintaining distribution networks of their own,more insurancecompanies choose to rely primarily on insurance intermediaries to distribute the insurance products and in return provide attractivemonetary incentives to the insurance intermediari
141、es.Heng Guang Insurance intends to grow its business by expanding its distribution network through opening additionalbrick and mortar offices and branches in China,expanding its online operations,and training and recruiting additional skilledprofessional sales agents in the life and health insurance
142、 sector.Heng Guang Insurance will also continue to seek opportunities tooffer innovative and premium services and products to its customers.In 2018,Heng Guang Insurance started the development ofthe mobile app Heng Kuai Bao,which provides sales support,training,agents commission management and insta
143、nt insurancequotes to our agents.Heng Guang Insurance plans to further develop and enhance its mobile app and online platform to extend thedigital services to its insurance purchasers,with the goal of allowing them to shop,compare and purchase insurance products,process insurance claims,and manage p
144、olicies all through Heng Kuai Bao as the one-stop application.In addition,Heng GuangInsurance diversified its insurance products by tapping into the health and life insurance sector in 2019.Furthermore,Heng GuangInsurance is allocating additional human and financial resources to its claim adjustment
145、 department in anticipation of future2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm11/270surging demand of its claim adjustment services as it sees more and more insurance companie
146、s choose to outsource claimadjustment functions to insurance agencies to minimize the costs of claim and risk management.12022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm12/270 The f
147、ollowing table illustrates the breakdown of our net commission revenues by insurance products for the years endedDecember 31,2021 and 2020.Year ended December 31,2021 Year ended December 31,2020(Restated)Revenue Percentage ofTotalcommissionrevenue Revenue Percentage ofTotalcommissionrevenue Automobi
148、le Insurance Mandatory$1,265,946 5.87%$1,038,399 5.30%Other 11,618,603 53.88%13,854,192 70.70%Property Insurance 386,809 1.79%90,770 0.46%Liability Insurance 1,764,131 8.18%969,881 4.95%Casualty Insurance 3,719,569 17.25%1,937,550 9.89%Construction and Engineering Insurance 645,712 2.99%691,709 3.53
149、%Life and Health Insurance 1,076,366 4.99%901,389 4.60%Cargo Transportation Insurance 907,884 4.21%23,174 0.12%Other 179,016 0.84%88,144 0.45%Total commission revenue,net$21,564,036 100.00%$19,595,208 100.00%The following table illustrates the breakdown of our net commission revenues by insurance pr
150、oducts for the six monthsended June 30,2022,and 2021.Six Months ended June 30,2022 Six Months ended June 30,2021 Revenue Percentage ofTotalcommissionrevenue Revenue Percentage ofTotalcommissionrevenue Automobile Insurance Mandatory$663,445 5.13%$376,628 4.69%Other 4,217,833 32.60%4,750,559 59.12%Pro
151、perty Insurance 58,580 0.45%25,631 0.32%Liability Insurance 837,273 6.47%494,805 6.16%Casualty Insurance 1,348,073 10.42%1,480,429 18.42%Construction and Engineering Insurance 553,411 4.28%415,644 5.17%Life and Health Insurance 1,509,276 11.66%315,289 3.92%Cargo transportation 3,667,513 28.34%50,784
152、 0.63%Other 84,406 0.65%126,124 1.57%Total commission revenue,net$12,939,810 100.00%$8,035,893 100.00%Contractual Arrangements Between Heng Guang Insurance And WFOE Heng Guang Cayman does not own any equity interest in Heng Guang Insurance,either directly or indirectly.Instead,foraccounting purposes
153、,Heng Guang Cayman is the primary beneficiary of Heng Guang Insurances business operation through aseries of variable interest contractual arrangements,which enables us to consolidate the financial results of the VIE in ourconsolidated financial statements under U.S.GAAP.HG Shareholders(as defined b
154、elow)and WFOE entered into a series ofcontractual arrangements,also known as VIE Agreements,on or about December 3,2020.We have evaluated the guidance inFinancial Accounting Standards Board Accounting Standards Codification 810 and determined that we are regarded as the primarybeneficiary of the VIE
155、 for accounting purposes,as a result of our direct ownership in the WFOE and the provisions of the VIEAgreements.Consequently,the Company consolidates the accounts of the VIE for the periods presented.Any references to controlor benefits that accrue to Heng Guang Cayman because of the VIE Agreements
156、 are limited to,and subject to conditions we havesatisfied for consolidation of the VIE under U.S.GAAP.The VIE is consolidated with Heng Guang Cayman for accountingpurposes but is not an entity in which Heng Guang Cayman owns equity.Heng Guang Cayman does not conduct any activeoperations and is the
157、primary beneficiary of the VIE for accounting purposes only.According to the Exclusive Management Consulting and Service Agreement and its supplementary agreement which clarifies thecalculation method of the service fee,Heng Guang Insurance is obligated to pay service fees to WFOE approximately equa
158、l to thenet income of Heng Guang Insurance after(i)offsetting the losses(if any)of Heng Guang Insurance in previous years,and(ii)deducting the required operating costs,expenses,tax and other statutory expenses.As of the date,the no such service fees has beenpaid by Heng Guang Insurance.2022/12/13htt
159、ps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm13/270 The VIE Agreements include the following and are described in details below:Exclusive Management Consulting and Service Agreement Pursuant t
160、o the Exclusive Management Consulting and Service Agreement between Heng Guang Insurance and WFOE datedDecember 3,2020,WFOE provides Heng Guang Insurance with technical support,consulting services,intellectual services andother management services relating to its day-to-day business operations and m
161、anagement,on an exclusive basis,utilizing itsadvantages in technology,human resources,and information.Additionally,Heng Guang Insurance granted a fully-paid exclusivelicense to WFOE to use all of the intellectual properties of Heng Guang Insurance and WFOE will be the owner of any and allintellectua
162、l property to be developed in the future either by Heng Guang Insurance or WFOE from the date of this ExclusiveManagement Consulting and Service Agreement.For services rendered by WFOE to Heng Guang Insurance under this agreementand its supplementary agreement,WFOE is entitled to collect a service f
163、ee which is approximately equal to the net income ofHeng Guang Insurance after(i)offsetting the losses(if any)of Heng Guang Insurance in previous years,and(ii)deducting therequired operating costs,expenses,tax and other statutory expenses.The Exclusive Management Consulting and Service Agreement sha
164、ll remain in effect for ten(10)years with an automatic renewalof another ten(10)years,and can only be terminated earlier if WFOE defaults,conduct of frauds,illegal activities or WFOE entersinto a bankruptcy or liquidation process(either voluntary or involuntary).WFOE is entitled to terminate this ag
165、reement byproviding a written 30-day notice to Heng Guang Insurance.22022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm14/270 The CEO of WFOE,Mr.Jiulin Zhang,who is also the CEO of Hen
166、g Guang Insurance,is currently managing Heng GuangInsurance pursuant to the terms of the Exclusive Management Consulting and Service Agreement.WFOE has absolute authorityrelating to the management of Heng Guang Insurance,including but not limited to decisions with regard to expenses,salary raisesand
167、 bonuses,hiring,firing and other operational functions.Upon establishment of Heng Guang Caymans audit committee at theconsummation of this offering,Heng Guang Caymans audit committee will be required to review and approve in advance anyrelated party transactions,including transactions involving WFOE
168、 or Heng Guang Insurance.Equity Pledge Agreement Under the Equity Pledge Agreement among WFOE,Heng Guang Insurance and each of the Heng Guang Insurance Shareholders,each Heng Guang Insurance Shareholder pledged all of his or her equity interests in Heng Guang Insurance to WFOE to guaranteethe perfor
169、mance of Heng Guang Insurance and any of Heng Guang Insurance shareholders obligations under the VIEAgreements.Under the terms of the Equity Pledge Agreement,in the event that Heng Guang Insurance or any of Heng GuangInsurance Shareholders breaches its respective contractual obligations under the VI
170、E Agreements,WFOE,as pledgee,will beentitled to certain rights,including,but not limited to,the right to collect dividends distributed from the pledged equity interests.All of the Heng Guang Insurance Shareholders also agreed that upon occurrence of any event of default,as set forth in the EquityPle
171、dge Agreement,WFOE is entitled to dispose the pledged equity interest in accordance with applicable PRC laws.Each HengGuang Insurance Shareholder further agreed not to dispose of the pledged equity interests or take any encumbrances on the equityinterests that would prejudice WFOEs interest.The Equi
172、ty Pledge Agreement is effective until the later of(i)all payments due under the VIE Agreements have been paid and(ii)all the obligations under the VIE Agreements have been performed by Heng Guang Insurance and Heng Guang InsuranceShareholders.WFOE shall cancel or terminate the Equity Pledge Agreeme
173、nt upon Heng Guang Insurances full payment of thefees payable under the VIE Agreements.The purposes of the Equity Pledge Agreement are to(1)guarantee the performance of Heng Guang Insurance and any of HengGuang Insurance shareholders obligations under the VIE Agreements,(2)make sure any Heng Guang I
174、nsurance Shareholder doesand will not transfer or assign the pledged equity interests,or create or allow any encumbrance that would prejudice WFOEsinterests without WFOEs prior written consent,and(3)provide WFOE de facto control over Heng Guang Insurance,which islimited to,and subject to conditions
175、we have satisfied for consolidation of the VIE under U.S.GAAP.In the event that HengGuang Insurance breaches its contractual obligations under the VIE Agreements,WFOE will be entitled to foreclose on anddispose all of Heng Guang Insurances issued and outstanding equity interests,have the right to(1)
176、exercise its option to purchaseor designate third parties to purchase part or all of Heng Guang Insurances equity interests and(2)terminate the VIE Agreementsafter acquisition of all equity interests in Heng Guang Insurance or form a new VIE structure with the third parties designated byWFOE.Exclusi
177、ve Option Agreement Under the Exclusive Option Agreement dated December 3,2020,each Heng Guang Insurance Shareholder irrevocably grantedWFOE(or its designee)an exclusive option to purchase,to the extent permitted under PRC laws,once or at multiple times,at anytime,part or all of its equity interests
178、 in Heng Guang Insurance.The option price is equal to the lowest price legally permitted byapplicable PRC laws and regulations.The Exclusive Option Agreement shall remain effective for a term of ten(10)years from the date of the Agreement,may beextended for another ten(10)years at the choice of the
179、WFOE,and can only be terminated by Heng Guang Insurance or itsshareholders if WFOE defaults,conduct of frauds,illegal activities or goes bankrupt or is dissolved,terminated according to law,or by the WFOE unilaterally.32022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf
180、-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm15/270 Proxy Agreement Under the Proxy Agreement dated December 3,2020,each Heng Guang Insurance Shareholder authorized WFOE to act on itsbehalf as its exclusive agent and attorney with respect to all rights as shar
181、eholders of Heng Guang Insurance,including but notlimited to:(a)attending shareholders meetings;(b)exercising all of the shareholders voting rights that the shareholders areentitled to under PRC laws and the articles of association of Heng Guang Insurance;and(c)designating and appointing on behalfof
182、 Heng Guang Insurance Shareholders the legal representative,the directors and other senior management members of HengGuang Insurance.The Proxy Agreement shall remain effective for a term of ten(10)years from the date of the Agreement,can be automaticallyrenewed in an increment of one(1)year each tim
183、e after the end of the initial 10-year term unless terminated earlier by WFOE.TheProxy Agreement is irrevocable and continuously valid from the date of execution of the Proxy Agreement,so long as any of theHeng Guang Insurance Shareholders is the shareholder of Heng Guang Insurance.The sale or trans
184、fer of one Heng GuangInsurance Shareholders equity interest in Heng Guang Insurance shall not interfere with or affect the force and validity of theProxy Agreement as to the remaining Heng Guang Insurance Shareholders.For accounting purposes,the Exclusive Management Consulting and Service Agreement,
185、together with the Equity PledgeAgreement,Exclusive Option Agreement,and the Proxy Agreement,enable WFOE to exercise effective control over Heng GuangInsurance,which in return enables us to consolidate the financial results of the VIE in our consolidated financial statements underU.S.GAAP.As a result
186、 of these VIE agreements,Heng Guang Cayman is currently the beneficiary of Heng Guang Insurance,andthe Company as a group of corporate entities accordingly treats Heng Guang Insurance as its VIE under U.S.GAAP.We haveevaluated the guidance in Financial Accounting Standards Board Accounting Standards
187、 Codification 810 and determined that weare regarded as the primary beneficiary of the VIE for accounting purposes,as a result of our direct ownership in WFOE and theprovisions of the VIE Agreements.We consolidate the financial results of Heng Guang Insurance in our consolidated financialstatements
188、in accordance with U.S.GAAP.Summary of challenges and risks involved in the VIE Arrangements and enforcing the VIE Agreements Because Heng Guang Cayman does not hold equity interests in the VIE,we are subject to risks due to the uncertainty of theinterpretation and application of the PRC laws and re
189、gulations,including but not limited to regulatory review of oversea listing ofPRC companies through a special purpose vehicle,and the validity and enforcement of the contractual arrangement with the VIE.We are also subject to the risks of the uncertainty that the PRC government could disallow the VI
190、E structure,which would likelyresult in a material change in our operations,or a complete hindrance of Heng Guang Caymans ability to offer or continue to offerits securities to investors,and the value of Heng Guang Caymans Class A Ordinary Shares may depreciate significantly.The VIEArrangements are
191、less effective than direct ownership due to the inherent risks of the VIE structure and that Heng Guang Caymanmay have difficulty in enforcing any rights Heng Guang Cayman may have under the VIE Agreements with the Heng GuangInsurance,its founders and shareholders in the PRC because all of the VIE A
192、greements are governed by the PRC laws and providefor the resolution of disputes through arbitration in the PRC,where the legal environment is uncertain and not as developed as inthe United States,and where the Chinese government has significant oversight and discretion over the conduct of Heng Guan
193、gInsurances business and may intervene or influence Heng Guang Insurances operations at any time with little advance notice,which could result in a material change in our operations and/or the value of your Class A ordinary shares.Furthermore,these VIEAgreements may not be enforceable in China if th
194、e PRC authorities or courts take a view that such VIE Agreements contravenewith the PRC laws and regulations or are otherwise not enforceable for public policy reasons.In the event Heng Guang Cayman isunable to enforce these VIE Agreements,it may not be able to exert effective influence over the VIE
195、,Heng Guang Insurance,andHeng Guang Insurances ability to conduct its business may be materially and adversely affected.Any references to control orbenefits that accrue to Heng Guang Cayman because of the VIE Agreements are limited to,and subject to conditions we havesatisfied for consolidation of t
196、he VIE under U.S.GAAP.See“Risk Factors Risks Related to Our Corporate Structure”,“RiskFactors Risks Related to Doing Business in China”and“Risk Factors Risks Relating to This Offering and The TradingMarket”for more information.Dividend Distribution Heng Guang Insurance,the PRC operating entity,recei
197、ves substantially all of its revenue in RMB.Under our current corporatestructure,to fund any cash and financing requirements Heng Guang Cayman may have,Heng Guang Cayman may rely ondividend payments from its subsidiaries.The WFOE may receive payments from Heng Guang Insurance,and then can remitpayme
198、nts to Heng Guang Hong Kong in accordance with its registration with the Chinese authority under the“Notice of the StateAdministration of Foreign Exchange on Relevant Issues concerning Foreign Exchange Administration for Domestic Residents toEngage in Financing and in Return Investment via Overseas
199、Special Purpose Companies”and pursuant to the VIE Agreements.Then Heng Guang Hong Kong may make distribution of such payments directly to Heng Guang Cayman as dividends to theholding company.See“Summary Consolidated Financial Data”on page 14.42022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/
200、0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm16/270 Under the existing PRC foreign exchange regulations,payments of current account items,such as profit distributions and trade andservice-related foreign exchange transactions,can be mad
201、e in foreign currencies without prior approval from the StateAdministration of Foreign Exchange(the“SAFE”)by complying with certain procedural requirements.Pursuant to the SAFECircular 37,Heng Guang Insurance is allowed to pay dividends in foreign currencies to WFOE without prior approval from theSA
202、FE,subject to the condition that the remittance of such dividends outside of the mainland PRC shall comply with certainprocedures under the PRC foreign exchange regulations applicable to PRC residents only.Approval from or registration withappropriate government authorities is,however,required where
203、 RMB is to be converted into a foreign currency and remitted out ofmainland China to pay capital expenses,such as the repayment of loans denominated in foreign currencies.The PRC governmentmay also,at its discretion,restrict access in the future to foreign currencies for Heng Guang Insurances accoun
204、ts with littleadvance notice.Shortages in the availability of foreign currency may restrict Heng Guang Insurances ability to remit sufficientforeign currency to pay dividends or other payments to Heng Guang Cayman.Current PRC regulations permit WFOE to pay dividends to Heng Guang Hong Kong only out
205、of its accumulated profits,if any,determined in accordance with Chinese accounting standards and regulations.In addition,in accordance with Article 166 of thePRC Company Law,each of our subsidiaries in mainland China is required to set aside at least 10%of its after-tax profits eachyear,if any,to fu
206、nd a statutory reserve until such reserve reaches 50%of its registered capital.Each such entity in China mayfurther set aside a portion of its after-tax profits as the discretionary common reserve,although the amount to be set aside,if any,isdetermined at the discretion of such entities board of dir
207、ectors.Although the statutory reserves can be used,among other ways,toincrease the registered capital and eliminate future losses in excess of retained earnings of the respective companies,the reservefunds are not distributable as cash dividends except in the event of liquidation.As of the date of t
208、his prospectus,there are no restrictions or limitations imposed by the Hong Kong government on the transfer ofcapital within,into and out of Hong Kong(including funds from Hong Kong to the mainland PRC),except for the transfer of fundsinvolving money laundering and criminal activities.However,there
209、is no guarantee that the Hong Kong government will notpromulgate new laws or regulations that may impose such restrictions in the future.As of the date of this prospectus,none of Heng Guang Cayman,its subsidiaries,or the VIE has a cash management policy.NeitherHeng Guang Insurance nor any of Heng Gu
210、ang Caymans other subsidiaries have ever paid dividends,made distributions,transferred cash or other assets by kind to Heng Guang Cayman or its shareholders directly or indirectly.The current laws andregulations of the PRC on currency exchange requires registration with or approval from the SAFE for
211、 conversion of RMB intoforeign currency and remission out of mainland China to pay capital expenses,such as the repayment of loans denominated inforeign currencies.The PRC government may also at its discretion restrict access in the future to foreign currencies for currentaccount transactions.Howeve
212、r,there is no assurance that the Chinese government will not,in the future,intervene or imposerestrictions or limitations on the Heng Guang Insurances ability to transfer cash out of mainland China and Hong Kong.AlsoHeng Guang Cayman has not made any distributions or paid dividends to its shareholde
213、rs,including U.S.investors,as of the dateof this prospectus.See“Summary Consolidated Financial Data”on page 14.We intend to keep any future earnings to re-invest in and finance the expansion of our business in China.We do not have theintentions to distribute earnings or settle amounts owed under the
214、 VIE Agreements in the near future nor do we anticipate that anycash dividends will be paid or Heng Guang Insurances earnings will be distributed and transferred to the holding company in theforeseeable future.Under the Cayman Islands law,a Cayman Islands company may pay a dividend on its shares out
215、 of either profitor share premium amount,provided that in no circumstances may a dividend be paid if this would result in the company beingunable to pay its debts due in the ordinary course of business.Cash dividends,if any,on our Class A Ordinary Shares will be paid in U.S.dollars.If we are conside
216、red a PRC tax residententerprise for tax purposes,any dividends we pay to our overseas shareholders may be regarded as China sourced income and as aresult may be subject to mainland PRC withholding tax at a rate of up to 10.0%.Pursuant to the Arrangement between MainlandChina and the Hong Kong Speci
217、al Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income,orthe Double Tax Avoidance Arrangement,the 10%withholding tax rate may be lowered to 5%.The 5%withholding tax rate,however,does not automatically apply and certain requirements must be satisfied,including without
218、 limitation that(a)the HongKong resident enterprise must be the beneficial owner of the relevant dividends;and(b)the Hong Kong resident enterprise mustdirectly hold more than 25%equity interest in the PRC resident enterprise during the 12 consecutive months preceding its receiptof the dividends.In c
219、urrent practice,a Hong Kong resident enterprise must obtain a tax resident certificate from the Hong Kongtax authority to apply for the 5%lower mainland PRC withholding tax rate.As the Hong Kong tax authority will issue such a taxresident certificate on a case-by-case basis,we cannot assure you that
220、 we will be able to obtain the tax resident certificate from therelevant Hong Kong tax authority and enjoy the preferential withholding tax rate of 5%under the Double Taxation Arrangementwith respect to any dividends paid by the WFOE to its immediate holding company,Heng Guang Hong Kong.As of the da
221、te ofthis prospectus,we have not applied for the tax resident certificate from the relevant Hong Kong tax authority.Heng Guang HongKong may apply for the tax resident certificate if and when the WFOE intend to declare and pay dividends to Heng Guang HongKong.52022/12/13https:/www.sec.gov/Archives/ed
222、gar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm17/270 Industry Background In recent years,the global insurance industry developed rapidly,with premium rising from$4.7 trillion in 2016 to$6.1 trillion in2020,according to C
223、hina Insurance Yearbook.The average insurance density in China,calculated as the ratio of total insurancepremiums divided by the entire Chinese population,has risen from$387 in 1999 to approximately$687 in 2020,as indicated inChina Insurance Yearbook.While the competition in the insurance industry w
224、orldwide has been intensive,the insurancecompanies in China have gained substantial market shares and established its significant position in the global insurance market.In2020,Brand Finance,a leading brand valuation and strategy consulting agency,announced the“Top 100 Most Valuable InsuranceBrands
225、in the World in 2020”which assigned a total value of the top 100 insurance brands on the list US$463.2 billion.Among thecompanies on the top 100 list,12 brands from the Greater China region(including mainland,Hong Kong and Taiwan)were on thelist,valued at approximately$151.5 billion dollars,accounti
226、ng for 32.7%of the total value of the 100 companies on such list.Asper a report from Statista,insurance density is a used as an indicator for the development of insurance within a country and iscalculated as ratio of total insurance premiums to whole population of a given country.Our reference to in
227、surance density is interms of reflecting to the number of insurance premiums sold in China in contrast to the number of people living in China.Despite this substantial growth and scale,the development of Chinas insurance market still lags behind certain developedcountries,leaving Chinese insurance c
228、ompanies and insurance intermediaries huge market potential.For instance,the statisticsfrom the Chinese National Bureau of Statistics showed that the insurance depth(the original insurance premium income/totalGDP in a country)in China was 4.45%compared to 7.3%of the worldwide average insurance depth
229、 in the year of 2020,reflectingChinese insurance depth being 64%lower than the world average as of December 2020.The low insurance depth rate relative tothose of developed economies and world average rate in 2020 suggest that Chinas insurance market has significant growthpotential.We believe that co
230、ntinued economic growth and the aging of the Chinese population,among other factors,will drive thefuture growth of Chinas insurance industry.In particular,we expect that changing demographics will generate substantial demandfor life insurance products.Within Chinas insurance industry,independent ins
231、urance agencies,serving insurance carriers,and insurance brokers,servingpolicy holders,are referred to as“professional insurance intermediaries,”to differentiate them from entities that distributeinsurance products as an ancillary business,such as commercial banks,postal offices and automobile deale
232、rships.The professionalinsurance intermediary sector in China has also grown significantly in recent years.According to data released by the CIRC,totalinsurance premiums generated by independent insurance institutions increased from RMB 147.2 billion in 2014 to RMB 482.8billion in 2018,with a four-y
233、ear compound growth rate of 34.5%and the total premiums generated by independent insuranceinstitutions in 2019 reached approximately RMB 540 billion,showing an annual increase of 10.91%compared to the totalpremiums in 2018.We believe that the professional insurance intermediary sector will continue
234、to offer substantial growthopportunities for the following reasons:Chinas insurance industry as a whole has significant growth potential due to its relatively low penetration rate comparedto more developed countries;as competition among insurance companies intensifies,insurance companies will probab
235、ly focus more on their corecompetencies and should increasingly outsource distribution of their products;as Chinese consumers become more sophisticated,they should increasingly seek a greater selection of insurance productsand services from different insurance companies with the benefit of independe
236、nt professional advice;and a favorable regulatory environment should benefit professional insurance intermediaries.Despite rapid growth in recent years,we believe that the professional insurance intermediary sector in the PRC is still at thedevelopment stage.As of December 2021,there were 2,647 prof
237、essional insurance intermediary firms in China,including 499professional insurance agencies,as reported by Jinri Toutiao,a Chinese news and information content platform and subsidiary ofByteDance,on June 10,2022.62022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.ht
238、mhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm18/270 Our Strengths We believe the following competitive strengths contribute to our success and differentiate us from our competitors:Value added one stop shop services;Innovative digital marketing,operation and managem
239、ent;National distribution network;Experienced management team;and Rigorous training and human capital development.Summary of Our Challenges and Risks We are,and expect for the foreseeable future to be,subject to all the risks and uncertainties,inherent to a development-stagebusiness and in a heavily
240、 regulated industry in China.As a result,we must establish many functions necessary to operate ourinsurance intermediary business,including expanding our managerial and administrative structure,assessing and implementing ourmarketing program,conducting risk management and compliance,implementing fin
241、ancial systems and controls and personnelrecruitment.Please read the“Risk Factors”section for the descriptions of the risks we face.These risks and challenges are,amongother things:Risks Related to Our Business and Industry We operate in an industry that is heavily regulated by relevant governmental
242、 agencies in China,and our business could benegatively impacted if we are unable to adapt our services to regulatory and policy changes in China.For further detailsplease see“Risk Factors-Because our industry is heavily regulated,any material changes in the regulatory environmentcould change the com
243、petitive landscape of our industry or require us to change the way we do business.Theadministration,interpretation and enforcement of the laws and regulations currently applicable to us could changerapidly.If we fail to comply with applicable laws and regulations,we may be subject to civil and crimi
244、nal penalties orlose our privilege to conduct insurance business,which could materially and adversely affect our business and results ofoperations.”on page 26.We may require additional capital to develop and expand our operations,which may not be available to us when werequire it.For further details
245、 please see“Risk Factors-We are subject to all the risks and uncertainties in an industrywhich is still in development in China.”on page 23.Our insurance products marketing and growth strategy may not be successful.For further details please see“Risk Factors-Our business and prospects could be mater
246、ially and adversely affected if we are not able to manage our growthsuccessfully”on page 18;and“We may not be successful in implementing important new strategic initiatives andtechnologies,which may have an adverse impact on our business and financial results”on page 24 Our business may be subject t
247、o significant fluctuations in operating results due to factors beyond our control,such ashealth epidemics,natural disasters or terrorist attacks.“Risk Factors-Unusual weather patterns,extreme weatherconditions and natural disasters could adversely affect the operations of our system,in-person insura
248、nce services andresults of our business operations”on page 22.Competition in our industry is intense and,if we are unable to compete effectively,we may lose customers or insurancecarrier partners and our financial results may be negatively affected.“Risk Factors-Competition in our industry isintense
249、 and,if we are unable to compete effectively,we may lose customers and our financial results may be negativelyaffected”on page 23.If our investments in our online platforms are not successful,our business and results of operations may be materially andadversely affected.“Risk Factors-If our investme
250、nts in our online platforms are not successful,our business and resultsof operations may be materially and adversely affected”on page 24.A severe or prolonged downturn in the global or Chinese economy could materially and adversely affect our business andour financial condition.“Risk Factors-We are
251、subject to all the risks and uncertainties in an industry which is still indevelopment in China”on page 23;and“Changes in Chinas economic,political,or social conditions or governmentpolicies could have a material adverse effect on our business and operations”on page 30.2022/12/13https:/www.sec.gov/A
252、rchives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm19/27072022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/for
253、mf-1a.htm20/270 Risks Related to Our Corporate Structure and Operation If the PRC government deems that the VIE Agreements in relation to the VIE do not comply with PRC regulatoryrestrictions on foreign investment in the relevant industries,or if these regulations or the interpretation of existingre
254、gulations change in the future,we could be subject to severe penalties or be forced to relinquish our interests in thoseChinese operations,which are substantially all of our business operations.For further details please see“Risk Factors-Because we conduct our agent business through Heng Guang Insur
255、ance,a VIE entity,if we fail to comply with applicablelaw,we could be subject to severe penalties and our business could be materially and adversely affected”on page 26,and“Risk Factors-Our Shareholders are subject to greater uncertainties because we operate through a VIE structure due torestriction
256、s on the direct ownership of the Chinese operating entities imposed by the CIRC even though the insuranceagency industry falls within the permitted category in accordance with the Catalogue and the Negative List”on page 28.We rely on contractual arrangements among WFOE and the VIE entity Heng Guang
257、Insurance and HG Shareholders,which may not be as effective in providing operational control as direct ownership and whereby Heng Guang Caymanmay have difficulty in enforcing its rights under the VIE Agreements.For further details please see“Risk Factors-Werely on contractual arrangements with Heng
258、Guang Insurance,a VIE entity,and its shareholders for the Chinaoperations,which may not be as effective in providing operational control as direct ownership”on page 27.The HG Shareholders may have potential conflicts of interest with Heng Guang Cayman which may adversely affect ourconsolidated busin
259、ess and financial condition.For further details please see“Risk Factors-The shareholders of the VIEmay have actual or potential conflicts of interest with us,which may materially and adversely affect our business andfinancial condition”on page 29.We rely on the business licenses,insurance agency bus
260、iness permit and certification and any lack of requisite approvals,licenses or permits applicable to our business may have a material adverse effect on our business and results ofoperations.For further details please see“Risk Factors-We may be adversely affected by the complexity,uncertaintiesand ch
261、anges in PRC regulation of internet-related businesses and companies,and any lack of requisite approvals,licenses or permits applicable to our business may have a material adverse effect on our business and results ofoperations”on page 34.Risks Related to Doing Business in China U.S.regulatory bodie
262、s may be limited in their ability to conduct investigations or inspections of our operations in China.For further details please see“Risk Factors-As a foreign private issuer,we are not subject to certain U.S.securities lawdisclosure requirements that apply to a domestic U.S.issuer,and are exempt fro
263、m certain Nasdaq corporate governancestandards applicable to U.S.issuers,which may limit the information publicly available to our investors and afford themless protection than if we were an U.S issuer”on page 40.Adverse regulatory developments in China may subject us to additional regulatory review
264、 and expose us to governmentinterference,and additional disclosure requirements and regulatory scrutiny to be adopted by the SEC in response to risksrelated to recent regulatory developments in China may impose additional compliance requirements for companies like uswith significant China-based oper
265、ations,all of which could increase our compliance costs,subject us to additionaldisclosure requirements,and/or suspend or terminate our future securities offerings,making capital-raising more difficult.For further details please see“Risk Factors-PRC laws and regulations governing our current busines
266、s operations aresometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operateprofitably.Changes and uncertainty in PRC laws and interpretation may materially and adversely affect our businessperformance and impede our operations in China.”on page 32 and
267、“Changes in Chinas economic,political,or socialconditions or government policies could have a material adverse effect on our business and operations”on page 30.The approval of the China Securities Regulatory Commission(the“CSRC”)and other compliance procedures may berequired in connection with this
268、offering,and,if required,we cannot predict whether we will be able to obtain suchapproval.For further details please see“Risk Factors-The disclosures in our reports and other filings with the SEC andour other public pronouncements are not subject to the scrutiny of any regulatory bodies in the PRC.”
269、on page 33.82022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm21/270 Uncertainties with respect to the PRC legal system could adversely affect us,the rules and regulations in China can
270、change quickly with little advance notice,and such uncertainties materially and adversely affect our business and impedeour ability to continue our operations in China.For further details please see“Risk Factors-PRC laws and regulationsgoverning our current business operations are sometimes vague an
271、d uncertain and any changes in such laws andregulations may impair our ability to operate profitably.Changes and uncertainty in PRC laws and interpretation maymaterially and adversely affect our business performance and impede our operations in China”on page 32 The Chinese government exerts substant
272、ial influence over the manner in which we must conduct our business activitiesand we conduct offerings outside China.We are currently not required to obtain approval from Chinese authorities to listour Ordinary Shares on Nasdaq,however,if the Chinese authorities exert more stringent requirements on
273、Heng GuangInsurance or our Cayman holding company regarding our offering,we may not be able to list or continue listing onNasdaq,offer securities to investors,or such Chinese restrictions may significantly limit or completely hinder our abilityto offer or continue to offer securities to investors an
274、d cause the value of such securities to decline significantly or becomeworthless.For further details please see“Risk Factors-If we become subject to the scrutiny,criticism and negativepublicity involving U.S.-listed Chinese companies,we may have to expend significant resources to investigate and res
275、olvesuch matters,which could harm our business operations,stock price and reputation”on page 32.Governmental control of currency conversion may affect the value of your investment.For further details please see“RiskFactors-Because our business is conducted in Chinese dollars or RMB and the price of
276、our Ordinary Shares is quoted inUnited States dollars,changes in currency conversion rates may affect the amount of proceeds we will receive after thecurrency exchange from U.S.dollars to RMB”on page 26.We are a holding company and we rely for funding on dividend payments from our subsidiaries and V
277、IE,which aresubject to restrictions under PRC laws.For further details please see“Risk Factors-PRC regulations of loans to anddirect investment in PRC entities by offshore holding companies and governmental control of currency conversion maydelay or prevent us from using the proceeds of this offerin
278、g to make loans or additional capital contributions to our PRCsubsidiary and the VIE,which could materially and adversely affect our liquidity and our ability to fund and expand ourbusiness”on page 32.If we become directly subject to the recent scrutiny,criticism and negative publicity involving U.S
279、.-listed Chinesecompanies,we may have to expend significant resources to investigate and resolve the matter which could harm ourbusiness operations and our reputation and could result in a loss of your investment in our securities,especially if suchmatter cannot be addressed and resolved favorably.F
280、or further details please see“Risk Factors-If we become subject tothe scrutiny,criticism and negative publicity involving U.S.-listed Chinese companies,we may have to expend significantresources to investigate and resolve such matters,which could harm our business operations,stock price and reputati
281、on”on page 32.PRC regulations relating to the establishment of offshore special purpose companies by PRC residents may subject ourPRC resident shareholders to penalties and limit our ability to inject capital into our PRC subsidiaries,limit our PRCsubsidiaries ability to distribute profits to us,or
282、otherwise adversely affect us.For further details please see“Risk Factors-Under the PRC Enterprise Income Tax Law,or the EIT Law,we may be classified as a“resident enterprise”of China,which could result in unfavorable tax consequences to us and our non-PRC shareholders”on page 29.PRC regulation of l
283、oans and direct investments by offshore holding companies to PRC entities may delay or prevent usfrom using the proceeds of this offering to make loans or additional capital contributions to our PRC subsidiaries,whichcould materially and adversely affect our liquidity and our ability to fund and exp
284、and our business in the PRC.For furtherdetails please see“Risk Factors-Our current corporate structure and business operations may be affected by the newlyenacted Foreign Investment Law”on page 36.We face risks related to health epidemics,such as the COVID-19 outbreak,and other outbreaks,which could
285、 disrupt ourbusiness operations and adversely affect our business,financial condition and results of operations.“Risk Factors-Weface risks related to epidemics,such as the COVID-19 outbreak originated in Wuhan,China at the end of 2019,and otheroutbreaks,which have disrupted and could in the future d
286、isrupt our operations and adversely affect our business,financial condition and results of operations”on page 31.Increases in labor costs or commission costs for sales agents in the PRC may adversely affect our business and ourprofitability.“Risk Factors-Increases in labor costs in the PRC may adver
287、sely affect our business and our profitability”on page 33.Current PRC regulations restrict currency conversion,which affects the cash flow within our corporate structure,and anyfurther change in PRC regulations may further affect the cash flow within our corporate structure.“Risk Factors-To theexten
288、t cash or assets of our business,of the VIE,or of our mainland PRC or Hong Kong subsidiaries,is in the mainland2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm22/270PRC or Hong Kong,
289、such cash or assets may not be available to fund operations or for other use outside of the mainlandPRC or Hong Kong,due to interventions in or the imposition of restrictions and limitations by the PRC government to thetransfer of cash or assets”on page 32.You may face further costs and obstacles in
290、 effecting service of legal process.“Risk Factors-You may incur additionalcosts and procedural obstacles in effecting service of legal process,enforcing foreign judgments or bringing actions inHong Kong against us or our management named in this prospectus based on Hong Kong laws.”On page 35.You may
291、 face difficulty in enforcing any civil rights judgment or claim against our management in mainland China.“RiskFactors-You may experience difficulties in effecting service of legal process,enforcing foreign judgments,or bringingactions in China against us or our management named in the prospectus ba
292、sed on foreign laws.It may also be difficult foryou or overseas regulators to conduct investigations or collect evidence within China.”on page 37.It may be difficult for overseas shareholders and regulators to collect evidence or pursue investigations in Hong Kong.“Risk factors-It may be difficult f
293、or overseas shareholders and/or regulators to conduct investigations or collectevidence within Hong Kong.”on page 35.You may encounter additional procedures and incur additional costs in enforcing foreign judgments in Hong Kong.“Riskfactors-You may incur additional costs and procedural obstacles in
294、effecting service of legal process,enforcing foreignjudgments or bringing actions in Hong Kong against us or our management named in this prospectus based on HongKong laws.”on page 35.It may be difficult for foreign shareholders and/or regulators to conduct investigations or collect evidence in Chin
295、a.“Riskfactors-It may be difficult for overseas regulators to conduct investigation or collect evidence within China.”and“It maybe difficult for overseas shareholders and/or regulators to conduct investigations or collect evidence within Hong Kong.”on page 35.92022/12/13https:/www.sec.gov/Archives/e
296、dgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm23/270 Risks Related to an Investment in Our Ordinary Shares and This Offering The recent joint statement by the SEC and The Public Company Accounting Oversight Board(United
297、 States),or the“PCAOB,”proposed rule changes submitted by The Nasdaq Stock Market LLC(“NASDAQ”),and an act passed by theU.S.Senate all call for additional and more stringent criteria to be applied to emerging market companies upon assessingthe qualification of their auditors,especially the non-U.S.a
298、uditors who are not inspected by the PCAOB.On September22,2021,the PCAOB adopted a final rule implementing the Holding Foreign Companies Accountable Act(the“HFCAA”),which became law in December 2020 and prohibits foreign companies from listing their securities on U.S.exchanges if the company has bee
299、n unavailable for PCAOB inspection or investigation for three consecutive years.InJune 2021,the Senate passed the Accelerating Holding Foreign Companies Accountable Act(the“AHFCAA”),which,ifsigned into law,would reduce the time period for the delisting of foreign companies under the HFCAA to two con
300、secutiveyears,instead of three years.Pursuant to the HFCAA and AHFCAA,our Class A Ordinary Shares may be prohibited totrade on a national exchange if the PCAOB is unable to inspect or fully investigate our auditor for two consecutive yearsbeginning in 2022.These developments could add uncertainties
301、to our offering.For further details please see“RiskFactors-The newly enacted“Holding Foreign Companies Accountable Act”and proposed“Accelerating HoldingForeign Companies Accountable Act”both call for additional and more stringent criteria to be applied to restrictivemarket companies upon assessing t
302、he qualification of their auditors,especially the non-U.S.auditors who are notinspected by the PCAOB.These developments could add uncertainties to our offering and if our auditors fail to permit thePublic Company Accounting Oversight Board(“PCAOB”)to inspect the auditing firm,our class A ordinary sh
303、ares maybe subject to delisting”on page 33.Investors purchasing Class A Ordinary Shares in this offering will experience immediate dilution.For further detailsplease see“Risk Factors-You will experience immediate and substantial dilution in the net tangible book value of ClassA Ordinary Shares purch
304、ased”on page 38.We have no plans to pay dividends on our Ordinary Shares.For further details please see“Risk Factors-We do not intendto pay dividends on our Class A Ordinary Shares in the foreseeable future”on page 38.There has been no public market for our Class A Ordinary Shares prior to this offe
305、ring,and you may not be able to resellour Class A Ordinary Shares at or above the price you pay for them,or at all.For further details please see“Risk Factors-There has been no public market for our Class A Ordinary Shares prior to this offering,and you may not be able to resellour Class A Ordinary
306、Shares at or above the price you have paid,or at all”on page 38.We are subject to liability risks stemming from our foreign status,which could make it more difficult for investors to sueor enforce judgments against us.For further details please see“Risk Factors-As a foreign private issuer,we are not
307、subject to certain U.S.securities law disclosure requirements that apply to a domestic U.S.issuer,and are exempt fromcertain Nasdaq corporate governance standards applicable to U.S.issuers,which may limit the information publiclyavailable to our investors and afford them less protection than if we w
308、ere an U.S issuer”on page 40.We are a“foreign private issuer,”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 provideinformation at different times,which may mak
309、e it more difficult for you to evaluate our performance and prospects.Forfurther details please see“Risk Factors-Risks Relating to This Offering And The Trading Market-As a foreign privateissuer,we are not subject to certain U.S.securities law disclosure requirements that apply to a domestic U.S.iss
310、uer,andare exempt from certain Nasdaq corporate governance standards applicable to U.S.issuers,which may limit theinformation publicly available to our investors and afford them less protection than if we were an U.S issuer”on page 40.The market price for our Class A ordinary shares may be volatile.
311、“Risk Factors-Risks Relating to This Offering And TheTrading Market-We may encounter extreme stock price volatility unrelated to our actual or expected operatingperformance and financial condition or prospects,making it difficult for prospective investors to assess the rapidlychanging value of our C
312、lass A ordinary shares.”on page 39.Our Strategy Our goal is to become a leading independent insurance agency in China and further develop our distribution network.To achievethis goal,we intend to capitalize on the growth potential of Chinas insurance industry and insurance intermediary sub-sector,le
313、verage our competitive strengths and pursue the following strategies:expand into the fast-growing life insurance sector while continuing to grow our property and casualty business;further expand our distribution network through opening new brick and mortar branches;further expand our online distribu
314、tion channels;2022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm24/270 grow our managed general agency model;consolidate insurance products offered by different insurance companies to
315、build a comprehensive insurance AI system;seek strategic acquisition targets;and continue to strengthen our relationships with leading insurance companies.Corporate Information Our principal executive office is located at 1666 Chenglong Road,Section 2,Chengdu Economic and Technological DevelopmentZo
316、ne,Building 2,5th Floor,Longquanyi District,Chengdu,Sichuan Province,China.Our telephone number at this address is(400)028-1990.Our registered office is at Ogier Global(Cayman)Limited,89 Nexus Way,Camana Bay Grand Cayman KY1-9009,Cayman Islands.Our legal name of Heng Guang Cayman is Hengguang Holdin
317、g Co.,Limited and we operate our businessunder the commercial name“Heng Guang Bao Dai”or“HG-Insurance Agency.”Investor inquiries should be directed to us at the address and telephone number of our principal executive offices set forth above.Our website address is http:/.The information contained on
318、our website is not part of this prospectus.Ouragent for service of process in the United States is Sichenzia Ross Ference LLP.102022/12/13https:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htmhttps:/www.sec.gov/Archives/edgar/data/1868110/0002841/formf-1a.htm25/270
319、 Recent Regulatory Development Insurance Agency Licenses and Chinese Auto Insurance Regulatory Reform As of the date of this prospectus,to operate the insurance agent business(online or offline),Heng Guang Insurance has(i)obtainedthe relevant insurance agency business national permit issued by the C
320、hina Bank and Insurance Regulatory Commission(the“CBIRC”)to its headquarters with such permit the expiring on June 13,2023,(ii)completed the insurance agency branchregistration recorded by the applicable Chinese local governmental agencies of each Heng Guang Insurances operating branchoffice,except
321、Changshou branch and Tangshan branch,which have filed the insurance agency registration documents,and therecently established Ziyang branch office and Nanyang branch office,and(iii)completed the level III information system securityregistration in Chengdu Public Security Bureau on January 21,2021.De
322、spite of our compliance efforts,some of our branch officeshave received regulatory letters and fines.Over the course of the past ten years(2011 to 2021),we have paid a total of RMB270,000(approximately$43,000 USD)of CBIRC fines for noncompliance with Chinese insurance laws and regulations.All ofHeng
323、 Guang Insurances fifty operating branches have registered with the CBIRCs insurance agency supervision informationsystem,including twenty four branches in Sichuan Province,five branches in Zhejiang Province,three branches in Hebei Province,two branches in Chongqing Province,two branches in Yunnan P
324、rovince,two branches in Hunan Province,two branches in GansuProvince,two branches in Henan Province,one branch in Jiangxi Province,one branch in Shanxi Province,one branch in GuizhouProvince,one branch in Shandong Province,one branch in Jiangsu Province,one branch in Liaoning Province,one branch in
325、JilinProvince,and one branch in Tibet Province.In addition,two of the branches have applied for licenses in Chongqing province andHebei province which are pending from the relevant local authorities as of the date of this prospectus.On September 1,2021,the CBIRC announced a series of regulatory refo
326、rms targeting the Chinese auto insurance companies andintermediaries,pursuant to which providers of auto insurance products will have to lower certain fees and expense rates charged onvarious auto insurance products.While the changes are predicted to make the products more affordable for consumers a
327、nd bringthem in line with international rates,they are also expected to have a negative impact on insurance agents revenue in connectionwith auto insurance products as a result of the newly lowered maximum expense ratios.Therefore,we believe this reform willpresent our auto insurance segment challen
328、ges in the next few years.Permissions from the PRC Authorities to Issue Our Class A Ordinary Shares to Foreign Investors As of the date of this prospectus,our mainland PRC counsel has advised us that(1)since the Administrative Measures for theFiling of Overseas Securities Offering and Listing by Dom
329、estic Companies is still in draft form and has not become effective,we,our subsidiaries and the VIE are not required to obtain permissions from China Securities Regulatory Commission(the“CSRC”)to operate the current business and offer to sell or issue our Class A Ordinary Shares being registered her
330、ein to non-Chineseinvestors,(2)based on that fact that none of Heng Guang Cayman,its subsidiaries,and the VIE collect,store or process customersinformation,Heng Guang Cayman,its subsidiaries,and the VIE are not required to obtain permissions under the Measures forCybersecurity Review(2021)from Cyber
331、space Administration of China(the“CAC”)to operate the current business and offer tosell or issue Heng Guang Caymans Class A Ordinary Shares being registered herein to non-Chinese investors.As such,HengGuang Cayman,its subsidiaries,the VIE believe that(1)we have received all requisite permissions or
332、approvals to operate thebusiness and offer to sell or issue Heng Guang Caymans Class A Ordinary Shares to non-Chinese investors and(2)none of HengGuang Cayman,its subsidiaries or the VIE has been denied such permissions by any mainland PRC authorities.In reliance on theadvice of Jingtian&Gongcheng,a
333、s of the date of this prospectus,we believe that we are not required to obtain any additionalmaterial permissions or approvals for our current business operations in mainland China and nor do we need any additionalpermission or approval to offer,sell or issue our Class A Ordinary Shares being registered herein to non-Chinese investors,butthere is no guarantee that the Chinese authorities will not