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1、F-1 1 ff12024_zhengyebio.htm REGISTRATION STATEMENTAs filed with the U.S.Securities and Exchange Commission on January 9,2024Registration No.333-UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549_FORM F-1REGISTRATION STATEMENTUNDERTHE SECURITIES ACT OF 1933_Zhengye Biotechnology Hol
2、ding Limited(Exact name of registrant as specified in its charter)_Cayman Islands 2834 Not Applicable(State or otherjurisdiction ofincorporation ororganization)(Primary StandardIndustrialClassification Code Number)(I.R.S.EmployerIdentification Number)No.1 Lianmeng Road,Jilin Economic&Technical Devel
3、opment ZoneJilin City,Jilin Province,China+86-Cogency Global Inc.122 East 42nd Street,18th FloorNew York,NY 10168(212)947-7200(Name,address,including zip code,and telephone number,including area code,ofagent for service)_With a Copy to:Ying Li,Esq.Guillaume de Sampigny,Esq.Hunter Taubma
4、n Fischer&Li LLC950 Third Avenue,19th FloorNewYork,NY10022 Fang Liu,Esq.VCL Law LLP1945 Old Gallows Road,Suite 260Vienna,VA22182703--530-2206_Approximate date of commencement of proposed sale to the public:Promptly after theeffective date of this registration statement.If any of the secur
5、ities being registered on this Form are to be offered on a delayed or continuousbasis pursuant to Rule415 under the Securities Actof1933 check the following box.If this Form is filed to register additional securities for an offering pursuant toRule462(b)under the Securities Act,please check the foll
6、owing box and list the Securities Actregistration statement number of the earlier effective registration statement for the sameoffering.If this Form is a post-effective amendment filed pursuant to Rule462(c)under the Securities Act,check the following box and list the Securities Act registration sta
7、tement number of the earliereffective registration statement for the same offering.If this Form is a post-effective amendment filed pursuant to Rule462(d)under the Securities Act,check the following box and list the Securities Act registration statement number of the earliereffective registration st
8、atement for the same offering.Indicate by check mark whether the registrant is an emerging growth company as defined in Rule405of the Securities Actof1933.Emerging growth companyIf an emerging growth company that prepares its financial statements in accordance with U.S.GAAP,indicate by check mark if
9、 the registrant has elected not to use the extended transition period forcomplying with any new or revised financial accounting standards provided pursuant to Section7(a)(2)(B)of the Securities Act.The term“new or revised financial accounting standard”refers to any update issued by theFinancial Acco
10、unting Standards Board to its Accounting Standards Codification after April5,2012.The Registrant hereby amends this registration statement on such date or dates as maybe necessary to delay its effective date until the Registrant shall file a furtheramendment which specifically states that this regis
11、tration statement shall thereafterbecome effective in accordance with Section8(a)of the Securities Act,or until theregistration statement shall become effective on such date as the U.S.Securitiesand Exchange Commission,acting pursuant to such Section8(a),may determine.Table of ContentsThe informatio
12、n in this prospectus is not complete and may be changed.We may notsell the securities until the registration statement filed with the U.S.Securitiesand Exchange Commission is effective.This prospectus is not an offer to sell thesesecurities and it is not soliciting any offer to buy these securities
13、in anyjurisdiction where such offer or sale is not permitted.SUBJECT TO COMPLETION PRELIMINARYPROSPECTUSDATEDJANUARY9,2024 Ordinary SharesZhengye Biotechnology Holding LimitedThis is an initial public offering on a firm commitment basis of our ordinary shares,par value$0.0001 per share(“Ordinary Sha
14、res”).Prior to this offering,there hasbeen no public market for our Ordinary Shares.We expect the initial public offeringprice to be in the range of$to$per Ordinary Share.The offering is beingmade on a“firm commitment”basis by the underwriters.See“Underwriting.”Wesubmitted our application to list ou
15、r Ordinary Shares on the Nasdaq Global Market(“Nasdaq”).At this time,Nasdaq has not yet approved our application to list ourOrdinary Shares.The closing of this offering is conditioned upon Nasdaqs finalapproval of our listing application,and there is no guarantee or assurance that ourOrdinary Shares
16、 will be approved for listing on Nasdaq.Investing in our Ordinary Shares involves a high degree of risk,includingthe risk of losing your entire investment.See“Risk Factors”beginningon page 16 to read about factors you should consider before buying ourOrdinary Shares.Unless otherwise stated,as used i
17、n this prospectus and in the context of describingour operations and consolidated financial information,“we,”“us,”“our,”the“Company,”“our Company,”or“Zhengye Cayman”refers to Zhengye BiotechnologyHolding Limited,an exempted company limited by shares incorporated in CaymanIslands,when describing Zhen
18、gye Caymans consolidated financial information for thesix months ended June 30,2023 and the fiscalyears ended December31,2022 and2021,also includes Zhengye Caymans subsidiaries,including subsidiaries in China;“VVAX Skyline”refers to VVAX Skyline Holdings Limited,a British Virgin Islandscorporation,w
19、hich is wholly owned by Zhengye Cayman;“Peg Biotechnology”refers toPeg Biotechnology(HK)Holding Limited,a Hong Kong corporation,which is whollyowned by VVAX Skyline;“Windsor Holdings”refers to Windsor Holdings Co.,Ltd.,aBritish Virgin Islands corporation,which is wholly owned by VVAX Skyline;and“Jil
20、in Zhengye”or the“operating entity”refers to Jilin Zhengye BiologicalProducts Co.,Ltd.,a limited liability company organized under the laws of the PRC,which is held 58.6890%by Hainan Senhan Biotechnology Co.,Ltd.(“Hainan Senhan”),25.1524%by Windsor Holdings,15.2439%by Jilin Economic and Technologica
21、lDevelopment Zone Economic and Technological Development General Corporation,0.9146%by Jilin Jinqiao Investment Co.,Ltd.,and 0.0001%by Yufeng Liu.Zhengye Cayman is a holding company incorporated in the Cayman Islands and not aChinese or Hong Kong operating company.As a holding company with no materi
22、aloperations of its own,Zhengye Cayman conducts its operations through its principalsubsidiary incorporated in China.See“Risk Factors Risks Relating to DoingBusiness in China Chinese regulatory authorities could disallow our holdingcompany structure,which may result in a material change in the opera
23、ting entitysoperations and/or a material change in the value of the securities we are registeringfor sale,including that it could cause the value of such securities to significantlydecline or become worthless.”The Ordinary Shares offered in this prospectus areshares of the Cayman Islands holding com
24、pany instead of shares of the operatingentity in China.Holders of our Ordinary Shares do not directly own any equityinterests in our subsidiaries,including the equity interests in our principalsubsidiary based in China,but will instead own shares of a Cayman Islands holdingcompany.We are subject to
25、certain legal and operational risks associated with being based inand having the majority of the Companys operations in China.These risks may resultin material changes in our operations,or a complete hindrance of our ability tooffer or continue to offer our securities to investors,and could cause th
26、e value ofsuch securities to significantly decline or become worthless.Recently,the PRCgovernment adopted a series of regulatory actions and issued statements to regulatebusiness operations in China with little advance notice,including cracking down onillegal activities in the securities market,adop
27、ting new measures to extend thescope of cybersecurity reviews,and expanding the efforts in anti-monopolyenforcement.As of the date of this prospectus,neither we nor the operating entityhave been involved in any investigations on cybersecurity review initiated by any PRCregulatory authority,nor has a
28、ny of them received any inquiry,notice,or sanction.The Cybersecurity Review Measures became effective on February 15,2022.Asconfirmed by our PRC counsel,Guantao Law Firm Hangzhou Office(“Guantao”),we donot expect to become subject to cybersecurity review by the CAC for this offering,given that:(i)th
29、e data the operating entity handles in its business operations,either by its nature or in scale,do not trigger significant concerns over PRCnational security;and(ii)neither we nor the operating entity have processed,oranticipate to process in the foreseeable future,personal information of more thano
30、ne million users or persons.Based on the above and the information currentlyavailable,we believe the impact of the CACs increasing oversight over datasecurity on the operating entitys business is immaterial as of the date of thisprospectus.However,there remains uncertainty as to how the Cybersecurit
31、y ReviewMeasures will be interpreted or implemented and whether the PRC regulatoryauthorities may adopt new laws,regulations,rules,or detailed implementation andinterpretation in relation Table of Contentsto,or in addition to the Cybersecurity Review Measures.While we intend to closelymonitor the ev
32、olving laws and regulations in this area and take all reasonablemeasures to mitigate compliance risks,we cannot guarantee that the operatingentitys business and operations will not be adversely affected by the potentialimpact of the Cybersecurity Review Measures or other laws and regulations related
33、 toprivacy,data protection,and information security.If the operating entity issubject to cybersecurity review and network data security review in the future,theoperating entity must apply for a review conducted by the Cybersecurity Review Officeof the PRC,which ranges from 30 to 90 working days.Duri
34、ng such review,theoperating entity may be required to suspend its operations or experience otherdisruptions to its operations.Cybersecurity review and network data security reviewcould materially and adversely affect our business,financial conditions,and resultsof operations,which could cause the va
35、lue of our securities to significantly declineor in extreme cases,become worthless.If the Office of Cybersecurity Reviewdetermines that our or the operating entitys business or operations involvenational security during its review,we and the operating entity may probably bebanned from accepting fore
36、ign investments or listing on a Unites States or otherforeign exchange.Furthermore,according to the Anti-Monopoly Law of the PeoplesRepublic of China(the“Anti-Monopoly Law”),which took effect on August 1,2008,where the concentration of business operators reaches the filing threshold stipulatedby the
37、 State Council of the Peoples Republic of China(the“State Council”),business operators shall file a declaration with the State Administration for MarketRegulation(the“SAMR”),and no concentration shall be implemented until the SAMRclears the anti-monopoly filing.We currently are not subject to the An
38、ti-MonopolyLaw because we dont reach the filing threshold stipulated by the State Council.Ifwe will be found to be subject to the Anti-Monopoly Law,we will be required to filea declaration with the SAMR,and no concentration shall be implemented until the SAMRclears the anti-monopoly filing,which ran
39、ges from 30 to 150 days.During suchreviews,we may be required to suspend the operations or experience other disruptionsto the operation,which will also result in negative publicity with respect to ourCompany and diversion of our managerial and financial resources,which couldmaterially and adversely
40、affect our business,financial conditions,and results ofoperations.If the SAMR determines that our or the operating entitys business oroperations involve national security,we and the operating entity may probably bebanned from accepting foreign investments or listing on a Unites States or otherforeig
41、n exchange.We believe that,based on the advice of Guantao,as of the date ofthis prospectus,neither we nor the operating entity are subject to the CybersecurityReview Measures or the Anti-Monopoly Law,because we and the operating entity fallbelow the review threshold stipulated by the CAC and the fil
42、ing threshold stipulatedby the State Council,and therefore,these laws do not have adverse impact on ourability to accept foreign investments or list on a Unites States or other foreignexchange.However,there are substantial uncertainties regarding the interpretationand application of PRC laws and reg
43、ulations and future PRC laws and regulations,andthere can be no assurance that the relevant government agencies will take a view thatis contrary to,or otherwise different from,the conclusions stated above.If therelevant government agencies take a view that is contrary to,or otherwise differentfrom,t
44、he foregoing conclusions,it could have a material adverse effect on the PRCsubsidiaries business,operating results and reputation,as well as the tradingprice of our Ordinary Shares and the Companys ability to accept foreign investmentsor list on a U.S.or other foreign exchange.See“Risk FactorsRisks
45、Relatingto Doing Business in China Recent greater oversight by the CAC over datasecurity,particularly for companies seeking to list on a foreign exchange,couldadversely impact our business and our offering”and“Risk Factors Risks Relatingto Doing Business in China Uncertainties in the interpretation
46、and enforcement ofPRC laws and regulations and changes in policies,rules,and regulations in China,which may be quick with little advance notice,could limit the legal protectionavailable to you and us.”On February 17,2023,the China Securities Regulatory Commission(“CSRC”)promulgated the Trial Adminis
47、trative Measures of the Overseas Securities Offering andListing by Domestic Companies(the“Overseas Listing Trial Measures”)and relevantfive guidelines,which became effective on March31,2023.According to the OverseasListing Trial Measures,PRC domestic companies that seek to offer and list securitiesi
48、n overseas markets,either in direct or indirect means,are required to fulfill thefiling procedures with the CSRC and report relevant information.Based on theforegoing,our PRC counsel is of the view that we are required to complete the filingprocedures with the CSRC in connection with the offering an
49、d listing.Any failure byus to comply with such filing requirements may result in orders to rectify,warningsand fines against us and could materially hinder our ability to offer or continue tooffer our securities.We have filed with the CSRC the filing documents and shallcomplete the filing before the
50、 completion of our overseas offering and listing.Giventhe current PRC regulatory environment,it is uncertain whether we will be requiredto obtain approvals from the PRC government to offer securities to foreign investorsin the future,and whether we would be able to obtain such approvals.If we areuna
51、ble to obtain such approvals if required in the future,or inadvertently concludethat such approvals are not required then the value of our ordinary shares maydepreciate significantly or become worthless.On February 24,2023,the CSRC promulgated the Provisions on StrengtheningConfidentiality and Archi
52、ves Administration of Overseas Securities Offering andListing by Domestic Companies(the“Confidentiality and Archives AdministrationProvisions”),which also became effective on March 31,2023.According to theConfidentiality and Archives Administration Provisions,domestic companies that seekoverseas off
53、ering and listing(either in direct or indirect means)and the securitiescompanies and securities service(either incorporated domestically or overseas)providers that undertake relevant businesses shall institute a sound confidentialityand archives administration system,and take necessary measures to f
54、ulfillconfidentiality and archives administration obligations.They shall not leak anystate secret and working secret of government agencies,or harm national security andpublic interest.Therefore,a domestic company that plans to,either directly orthrough its overseas listed entity,publicly disclose o
55、r provide to relevantindividuals or entities including securities companies,securities service providersand overseas regulators,any documents and materials that Table of Contentscontain state secrets or working secrets of government agencies,shall first obtainapproval from competent authorities acco
56、rding to law,and file with the secrecyadministrative department at the same level.The above-mentioned documents andmaterials that,if leaked,will be detrimental to national security or publicinterest,therefore,the domestic company shall strictly fulfill relevant proceduresstipulated by applicable reg
57、ulations.Furthermore,a domestic company that providesaccounting archives or copies of accounting archives to any entities includingsecurities companies,securities service providers and overseas regulators andindividuals shall fulfill due procedures in compliance with applicable regulations.Working p
58、apers produced in Chinese mainland by securities companies and securitiesservice providers in the process of undertaking businesses related to overseasoffering and listing by domestic companies shall be retained in Chinese mainland.Where such documents need to be transferred or transmitted to outsid
59、e Chinesemainland,relevant approval procedures stipulated by regulations shall be followed.We believe that this offering does not involve leaking any state secret and workingsecret of government agencies,or harming national security and public interest.However,we may be required to perform additiona
60、l procedures in connection with theprovision of accounting archives in accordance with the Confidentiality and ArchivesAdministration Provisions.The specific requirements of the relevant procedures arecurrently unclear and we cannot be certain whether we will be able to perform therelevant procedure
61、s.As of the date of this prospectus,except for the Supplementary Material Requestissued by the CSRC regarding our planned overseas listing on September 26,2023,towhich we responded by submitting supplementary materials on October 16,2023,we andthe operating entity have not received any inquiry,notic
62、e,warning,or sanctionsregarding our planned overseas listing from the CSRC or any other PRC governmentalauthorities.Since these statements and regulatory actions are newly published,however,official guidance and related implementation ruleshave not been issued.Itis highly uncertain what the potentia
63、l impact such modified or new laws andregulations will have on the daily business operations of our subsidiaries and theoperating entity,our ability to accept foreign investments,and our listing on anU.S.exchange.The Standing Committee of the National Peoples Congress(the“SCNPC”)or PRC regulatory au
64、thorities may in the future promulgate laws,regulations,or implementing rules that require us,or our subsidiaries,or theoperating entity to obtain regulatory approval from Chinese authorities beforelisting in the U.S.If we do not receive or maintain the approval,or inadvertentlyconclude that such ap
65、proval is not required,or applicable laws,regulations,orinterpretations change such that we are required to obtain approval in the future,wemay be subject to an investigation by competent regulators,fines or penalties,or anorder prohibiting us from conducting an offering,and these risks could result
66、 in amaterial adverse change in our operations and the value of our Ordinary Shares,significantly limit or completely hinder our ability to offer or continue to offersecurities to investors,or cause such securities to significantly decline in valueor become worthless.The same legal and operational r
67、isks associated with operations in mainland Chinaalso apply to operations in Hong Kong.Hong Kong was established as a specialadministrative region of the PRC in accordance with Article31 of the Constitutionof the PRC.The Basic Law of the HongKong Special Administrative Region of the PRC(the“Basic La
68、w”)was adopted and promulgated on April4,1990 and became effectiveon July1,1997,when the PRC resumed the exercise of sovereignty over HongKong.Pursuant to the Basic Law,HongKong is authorized by the National Peoples Congressof the PRC to exercise a high degree of autonomy and enjoy executive,legisla
69、tive,and independent judicial power,under the principle of“one country,two systems,”and the PRC laws and regulations shall not be applied in HongKong except for thoselisted in AnnexIII of the Basic Law(which is confined to laws relating to nationaldefense,foreign affairs,and other matters that are n
70、ot within the scope ofautonomy).However,there is no assurance that there will not be any changes in theeconomic,political,and legal environment in HongKong in the future.Due to theuncertainty of the PRC legal system and changes in laws,regulations,or policies,the Basic Law may be revised in the futu
71、re and thus we may face the same legal andoperational risks associated with operating in the PRC.If there is a significantchange to current political arrangements between mainland China and HongKong,or ifthe applicable laws,regulations,or interpretations change,our Hong Kongsubsidiary,Peg Biotechnol
72、ogy,may become subject to PRC laws or authorities.As aresult,our HongKong subsidiary could incur material costs to ensure compliance,besubject to fines,experience devaluation of securities or delisting,no longerconduct offerings to foreign investors,and no longer be permitted to continue theircurren
73、t business operations.In addition,our Ordinary Shares may be prohibited from trading on a nationalexchange under the Holding Foreign Companies Accountable Act,or the“HFCA Act,”ifthe Public Company Accounting Oversight Board(United States)(the“PCAOB”)isunable to inspect our auditors for three consecu
74、tiveyears beginning in 2022.OnDecember16,2021,the PCAOB issued a report on its determinations that it is unableto inspect or investigate completely PCAOB-registered public accounting firmsheadquartered in mainland China or in HongKong,a Special Administration Region ofthe PRC,because of positions ta
75、ken by PRC authorities in those jurisdictions.Ourauditor,WWC,P.C.(“WWC”),is headquartered in San Mateo,California,and has beeninspected by the PCAOB on a regular basis,with the last inspection in 2021.ThePCAOB currently has access to inspect the working papers of our auditor and ourauditor is not su
76、bject to the determinations announced by the PCAOB on December16,2021,which determinations were vacated on December 15,2022.If trading in ourOrdinary Shares is prohibited under the HFCA Act in the future because the PCAOBdetermines that it cannot inspect or fully investigate our auditor at such futu
77、retime,Nasdaq may determine to delist our Ordinary Shares and trading in our OrdinaryShares could be prohibited.On June 22,2021,the U.S.Senate passed theAccelerating Holding Foreign Companies Accountable Act(“AHFCAA”),and onDecember 29,2022,legislation entitled“Consolidated Appropriations Act,2023”(
78、the“Consolidated Appropriations Act”)was Table of Contentssigned into law by President Biden,which contained,among other things,an identicalprovision to the Accelerating Holding Foreign Companies Accountable Act and amendedthe HFCA Act by requiring the SEC to prohibit an issuers securities from trad
79、ing onany U.S.stock exchanges if its auditor is not subject to PCAOB inspections for twoconsecutiveyears instead of three,thus reducing the time period for triggering theprohibition on trading.On August26,2022,the CSRC,the Ministry of Finance of thePRC(the“MOF”),and the PCAOB signed a Statement of P
80、rotocol(the“Protocol”)governing inspections and investigations of accounting firms based in mainland Chinaand HongKong,taking the first step toward opening access for the PCAOB to inspectand investigate registered public accounting firms headquartered in mainland Chinaand HongKong.Pursuant to the fa
81、ct sheet with respect to the Protocol disclosed bythe U.S.Securities and Exchange Commission(the“SEC”),the PCAOB shall haveindependent discretion to select any issuer audits for inspection or investigationand has the unfettered ability to transfer information to the SEC.On December15,2022,the PCAOB
82、Board determined that the PCAOB was able to secure complete access toinspect and investigate registered public accounting firms headquartered in mainlandChina and HongKong and voted to vacate its previous determinations to the contrary.However,should PRC authorities obstruct or otherwise fail to fac
83、ilitate the PCAOBsaccess in the future,the PCAOB Board will consider the need to issue a newdetermination.See“Risk Factors Risks Relating to Doing Business in thePRCRecent joint statement by the SEC and the PCAOB,rule changed by Nasdaq,andthe HFCA Act all call for additional and more stringent crite
84、ria to be applied toemerging market companies upon assessing the qualification of their auditors,especially the non-U.S.auditors who are not inspected by the PCAOB.Thesedevelopments could add uncertainties to our offerings.”As of the date of this prospectus,except for a loan from the operating entit
85、y toHainan Senhan on October 10,2023,with a principal amount of RMB100,000,no cashtransfer or transfer of other assets has occurred among the Company and any of itssubsidiaries.See“Prospectus SummaryAsset Transfers Between the Company andits Subsidiaries,”“Prospectus SummaryDividends or Distribution
86、s Made to theCompany and U.S.Investors and Tax Consequences,”and our audited consolidatedfinancial statements for theyears ended December31,2022 and 2021.During the six months ended June 30,2023 and the fiscalyears ended December31,2022 and 2021,dividends and distributions made by the operating enti
87、ty to itsoriginal shareholders amounted to RMB18,000,000,RMB21,424,500,and RMB11,047,500,respectively.On April28,2023,the shareholders of the operating entity passed theresolution of the dividend plan for 2022,with the dividend amount of RMB55,104,000,and the dividend will be distributed before May2
88、024.Except as disclosed,we intendto keep any future earnings to finance the expansion of our business,and we do notanticipate that any cash dividends will be paid in the foreseeable future.See“Prospectus Summary Dividends or Distributions Made to the Company andU.S.Investors and Tax Consequences.”We
89、 are an“emerging growth company”as defined under the federal securities laws andwill be subject to reduced public company reporting requirements.Please read thedisclosures beginning on page 13 of this prospectus for more information.Following the completion of this offering,our director,chairman of
90、the board ofdirectors and largest shareholder,Mr.Zhenfa Han,will beneficially ownapproximately%of the aggregate voting power of our issued and outstandingOrdinary Shares.As such,we may be deemed a“controlled company”under NasdaqMarketplace Rules 5615(c).However,even if we are deemed a“controlled com
91、pany,”wedo not intend to avail ourselves of the corporate governance exemptions afforded to a“controlled company”under the Nasdaq Listing Rules.See“Risk Factors”and“ManagementControlled Company.”Per Share TotalInitial public offering price$Underwriters discounts(1)$Proceeds to our company before exp
92、enses(2)$_(1)We have agreed to pay US Tiger Securities,Inc.,the representative of the underwriters(the“Representative”),a fee equal to 7%of the gross proceeds of the offering.See“Underwriting”starting on page 154 of this prospectus for more information regarding ourarrangements with the underwriters
93、.The underwriters expect to deliver the Ordinary Shares against payment on or about,2024.Neither the U.S.Securities and Exchange Commission nor any statesecurities commission nor any other regulatory body has approved ordisapproved of these securities or determined if this prospectus istruthful or c
94、omplete.Any representation to the contrary is a criminaloffense.US Tiger Securities,Inc.Prospectus dated,2024 Table of ContentsTABLE OF CONTENTS PagePROSPECTUS SUMMARY 1RISK FACTORS 16DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS 48ENFORCEABILITY OF CIVIL LIABILITIES 49USE OF PROCEEDS 50DIVIDEND P
95、OLICY 52CAPITALIZATION 53DILUTION 54CORPORATE HISTORY AND STRUCTURE 55MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OFOPERATIONS 57INDUSTRY 74BUSINESS 87REGULATIONS 116MANAGEMENT 127PRINCIPAL SHAREHOLDERS 132RELATED PARTY TRANSACTIONS 134DESCRIPTION OF SHARE CAPITAL 135SHARE
96、S ELIGIBLE FOR FUTURE SALE 146MATERIAL INCOME TAX CONSIDERATION 147UNDERWRITING 154EXPENSES RELATING TO THIS OFFERING 158LEGAL MATTERS 159EXPERTS 159WHERE YOU CAN FIND ADDITIONAL INFORMATION 159INDEX TO FINANCIAL STATEMENTS F-1iTable of ContentsABOUT THIS PROSPECTUSWe and the underwriters have not a
97、uthorized anyone to provide any information or tomake any representations other than those contained in this prospectus or in any freewriting prospectuses prepared by us or on our behalf or to which we have referredyou.We take no responsibility for and can provide no assurance as to the reliabilityo
98、f,any other information that others may give you.This prospectus is an offer tosell only the Ordinary Shares offered hereby,but only under circumstances and injurisdictions where it is lawful to do so.We are not making an offer to sell thesesecurities in any jurisdiction where the offer or sale is n
99、ot permitted or where theperson making the offer or sale is not qualified to do so or to any person to whom itis not permitted to make such offer or sale.For the avoidance of doubt,no offer orinvitation to subscribe for Ordinary Shares is made to the public in the CaymanIslands.The information conta
100、ined in this prospectus is current only as of the dateon the front cover of the prospectus.Our business,financial condition,results ofoperations,and prospects may have changed since that date.Neither we nor the underwriters have taken any action to permit a public offering ofthe Ordinary Shares outs
101、ide the United States or to permit the possession ordistribution of this prospectus or any filed free-writing prospectus outside theUnitedStates.Persons outside the UnitedStates who come into possession of thisprospectus or any filed free writing prospectus must inform themselves about,andobserve an
102、y restrictions relating to,the offering of the Ordinary Shares and thedistribution of this prospectus or any filed free-writing prospectus outside theUnitedStates.Conventions that Apply to this ProspectusUnless otherwise indicated or the context requires otherwise,references in thisprospectus to:“BV
103、I”are to the British Virgin Islands;“China”or the“PRC”are to the Peoples Republic of China,excludingTaiwan for the purposes of this prospectus only;“GMP”are to Good Manufacturing Practice;“GSP”are to Good Supplying Practice;“HKD”or“HK$”are to the legal currency of HongKong;“HongKong”are to the HongK
104、ong Special Administrative Region of thePeoples Republic of China;“ODI filings”are to the formalities and filings of overseas directinvestment of Chinese enterprises,including but not limited to fulfillingthe filing,approval or registration procedures in the development andreform authorities,the com
105、petent commercial authorities,and foreignexchange administration authorities and competent banks authorized by suchauthorities;“Renminbi”or“RMB”are to the legal currency of China;“shares,”“Shares,”or“Ordinary Shares”are to the ordinary shares ofZhengye Cayman,par value$0.0001 per share;and“$,”“USD,”
106、“US$,”or“U.S.dollars”are to the legal currency ofthe UnitedStates.Our business is conducted by the operating entity in China using RMB.Ourconsolidated financial statements are presented in U.S.dollars.In this prospectus,we refer to assets,obligations,commitments,and liabilities in our consolidatedfi
107、nancial statements in U.S.dollars.These dollar references are based on theexchange rate of RMB to U.S.dollars,determined as of a specific date or for aspecific period.Changes in the exchange rate will affect the amount of ourobligations and the value of our assets in terms of U.S.dollars which may r
108、esult inan increase or decrease in the amount of our obligations(expressed in dollars)andthe value of our assets,including accounts receivable(expressed in dollars).Withrespect to amounts not recorded in our consolidated financial statements includedelsewhere in this prospectus,the conversion of RMB
109、 into U.S.dollars is based on0.1450 for the fiscal years ended December 31,2022 and 2021,and the conversion ofRMB into U.S.dollars is based on 0.1379 for the six months ended June 30,2023 and2022.iiTable of ContentsPROSPECTUS SUMMARYThe following summary is qualified in its entirety by,and should be
110、 read inconjunction with,the more detailed information and financial statements appearingelsewhere in this prospectus.In addition to this summary,we urge you to read theentire prospectus carefully,especially the risks of investing in our OrdinaryShares discussed under“Risk Factors,”“Business,”and in
111、formation contained in“Managements Discussion and Analysis of Financial Condition and Results ofOperations”before deciding whether to invest in our Ordinary Shares.Thisprospectus contains information from an industry report in March2023,commissionedby us and prepared by Frost&Sullivan,a third-party
112、independent research firm.Werefer to this report as the Frost and Sullivan Report.Our Corporate StructureWe are a holding company incorporated in the Cayman Islands.Our Ordinary Sharesoffered in this prospectus are shares of our Cayman Islands holding company.As aholding company with no material ope
113、rations of our own,we conduct our operationsthrough the operating entity established in the PRC.See“Risk Factors RisksRelating to Doing Business in China Chinese regulatory authorities could disallowour holding company structure,which may result in a material change in theoperating entitys operation
114、s and/or a material change in the value of thesecurities we are registering for sale,including that it could cause the value ofsuch securities to significantly decline or become worthless.”The Ordinary Sharesoffered in this prospectus are shares of the Cayman Islands holding company insteadof shares
115、 of the operating entity in China.Holders of our Ordinary Shares do notdirectly own any equity interests in the operating entity,but will instead ownshares of a Cayman Islands holding company.The following diagram illustrates our corporate structure as of the date of thisprospectus and upon the comp
116、letion of this offering,assuming the sales of all ofthe Ordinary Shares we are offering at an assumed public offering price of$per share.For more details on our corporate history,please refer to“CorporateHistory and Structure.”_Notes:(i)All percentages reflect the equity interests.(1)Represents 10,0
117、00,000Ordinary Shares held by Securingium Holding Limited,a BVI company,which is(i)0.01%owned by Jiahe Developments Limited,which itself is 100%owned by ZhenfaHan,and(ii)99.99%owned by TSset Holding Limited,which itself is 100%owned by TridentTrust Company(HK)Limited,which acts as the trustee of Gen
118、erations United Trust,as of thedate of this prospectus.The settlor,beneficiary,and protector of Generations United Trustis Zhenfa Han.(2)Represents 570,830Ordinary Shares held by VVAX Holdings Limited,a BVI company,which is100%owned by Jilin Zhengye Group Co.,Ltd.,which is 99%owned by Zhenfa Han and
119、 1%ownedby Lihua Sun,as of the date of this prospectus.(3)Represents 569,688 Ordinary Shares held by Vanguards Skyline Holdings Limited,a BVIcompany,which is 100%owned by Changchun Feier Investment Center(Limited Partnership),which is 64.81%owned by Zhenfa Han.Changchun Feier Investment Center(Limit
120、ed Partnership)is ultimately controlled by its managing partner,Zhenfa Han,as of the date of thisprospectus.1Table of Contents(4)Represents 259,465Ordinary Shares held by TLjinmao Limited,a BVI company,which is 100%owned by Nanjing Tailong Jinmao Pharmaceutical Industry Investment Enterprise(Limited
121、Partnership),which is a private equity fund established and managed by Tibet GoldenInvestment Management Co.,Ltd.,as of the date of this prospectus.Tibet Golden InvestmentManagement Co.,Ltd.is a Chinese private equity fund management company focusing oninvestment management and financial information
122、 consulting.(5)Represents 16,611Ordinary Shares held by XZjinyuan Limited,a BVI company,which is 100%owned by Tibet Golden Investment Management Co.,Ltd.,which is a Chinese private equityfund management company focusing on investment management and financial informationconsulting,as of the date of t
123、his prospectus.(6)Jilin Zhengye is held 58.6890%by Hainan Senhan,25.1524%by Windsor Holdings,15.2439%byJilin Economic and Technological Development Zone Economic and Technological DevelopmentGeneral Corporation,0.9146%by Jilin Jinqiao Investment Co.,Ltd.,and 0.0001%by YufengLiu,as of the date of thi
124、s prospectus.We are subject to certain legal and operational risks associated with the businessoperations in mainland China and HongKong.PRC laws and regulations governing thecurrent business operations of the operating entity are sometimes vague anduncertain,and as a result,these risks may result i
125、n material changes in theoperations of the operating entity,significant depreciation of the value of ourOrdinary Shares,or a complete hindrance of our ability to offer,or continue tooffer,our securities to investors.Recently,the PRC government adopted a seriesof regulatory actions and issued stateme
126、nts to regulate business operations inChina with little advance notice,including cracking down on illegal activities inthe securities market,adopting new measures to extend the scope of cybersecurityreviews,and expanding the efforts in anti-monopoly enforcement.The CybersecurityReview Measures,which
127、 became effective on February 15,2022,provide that,inaddition to CIIOs that intend to purchase Internet products and services,dataprocessing operators engaging in data processing activities that affect or mayaffect national security must be subject to cybersecurity review by theCybersecurity Review
128、Office of the PRC.According to the Cybersecurity ReviewMeasures,a cybersecurity review assesses potential national security risks thatmay be brought about by any procurement,data processing,or overseas listing.TheCybersecurity Review Measures further require that online platform operators thatposses
129、s personal data of at least one million users must apply for a review by theCybersecurity Review Office of the PRC before conducting listings in foreigncountries.As of the date of this prospectus,neither we nor the operating entityhave been involved in any investigations on cybersecurity review init
130、iated by anyPRC regulatory authority,nor has any of them received any inquiry,notice,orsanction.We do not expect to become subject to cybersecurity review by the CAC forthis offering,given that:(i)the data the operating entity handles in itsbusiness operations,either by its nature or in scale,do not
131、 trigger significantconcerns over PRC national security;and(ii)neither we nor the operating entityhave processed,or anticipate to process in the foreseeable future,personalinformation of more than one million users or persons.Based on the above and theinformation currently available,we believe the i
132、mpact of the CACs increasingoversight over data security on the operating entitys business is immaterial as ofthe date of this prospectus.However,there remains uncertainty as to how theCybersecurity Review Measures will be interpreted or implemented and whether thePRC regulatory authorities may adop
133、t new laws,regulations,rules,or detailedimplementation and interpretation in relation to,or in addition to theCybersecurity Review Measures.While we intend to closely monitor the evolving lawsand regulations in this area and take all reasonable measures to mitigatecompliance risks,we cannot guarante
134、e that the operating entitys business andoperations will not be adversely affected by the potential impact of theCybersecurity Review Measures or other laws and regulations related to privacy,data protection,and information security.If the operating entity is subject tocybersecurity review and netwo
135、rk data security review in the future,the operatingentity must apply for a review conducted by the Cybersecurity Review Office of thePRC,which ranges from 30 to 90 working days.During such review,the operatingentity may be required to suspend its operations or experience other disruptions toits oper
136、ations.Cybersecurity review and network data security review couldmaterially and adversely affect our business,financial conditions,and results ofoperations,which could cause the value of our securities to significantly declineor in extreme cases,become worthless.If the Office of Cybersecurity Revie
137、wdetermines that our or the operating entitys business or operations involvenational security during its review,we and the operating entity may probably bebanned from accepting foreign investments or listing on a Unites States or otherforeign exchange.Furthermore,according to the Anti-Monopoly Law o
138、f the PeoplesRepublic of China(the“Anti-Monopoly Law”),which took effect on August 1,2008,where the concentration of business operators reaches the filing thresholdstipulated by the State Council of the Peoples Republic of China(the“StateCouncil”),business operators shall file a declaration with the
139、 StateAdministration for Market Regulation(the“SAMR”),and no concentration shall beimplemented until the SAMR clears the anti-monopoly filing.We currently are notsubject to the Anti-Monopoly Law because we dont reach the filing thresholdstipulated by the State Council.If we will be found to be subje
140、ct to the Anti-Monopoly Law,we will be required to file a declaration with the SAMR,and noconcentration shall be implemented until the SAMR clears the anti-monopoly filing,which ranges from 30 to 150 days.During such reviews,we may be required tosuspend the operations or experience other disruptions
141、 to the operation,whichcould materially and adversely affect our business,2Table of Contentsfinancial conditions,and results of operations,which could cause the value of oursecurities to significantly decline or in extreme cases,become worthless.If theSAMR determines that our and the operating entit
142、ys business or operations involvenational security,we and the operating entity may probably be banned fromaccepting foreign investments or listing on a Unites States or other foreignexchange.We believe that,based on the advice of Guantao,as of the date of thisprospectus,neither we nor the operating
143、entity are subject to the CybersecurityReview Measures or the Anti-Monopoly Law,because we and the operating entity fallbelow the review threshold stipulated by the CAC and the filing thresholdstipulated by the State Council,and therefore,these laws do not have adverseimpact on our ability to accept
144、 foreign investments or list on a Unites States orother foreign exchange.However,there are substantial uncertainties regarding theinterpretation and application of PRC laws and regulations and future PRC laws andregulations,and there can be no assurance that the relevant government agencieswill take
145、 a view that is contrary to,or otherwise different from,the conclusionsstated above.If the relevant government agencies take a view that is contrary to,or otherwise different from,the foregoing conclusions,it could have a materialadverse effect on the PRC subsidiaries business,operating results and
146、reputation,as well as the trading price of our Ordinary Shares and the Companys ability toaccept foreign investments or list on a U.S.or other foreign exchange.See“RiskFactorsRisks Relating to Doing Business in ChinaRecent greater oversightby the CAC over data security,particularly for companies see
147、king to list on aforeign exchange,could adversely impact our business and our offering”and“RiskFactors Risks Relating to Doing Business in China Uncertainties in theinterpretation and enforcement of PRC laws and regulations and changes in policies,rules,and regulations in China,which may be quick wi
148、th little advance notice,could limit the legal protection available to you and us.”On February17,2023,the CSRC promulgated the Overseas Listing Trial Measures andfive supporting guidelines,which came into effect on March 31,2023.We arerequired to complete the filing procedures with the CSRC in conne
149、ction with theoffering and listing pursuant to the Overseas Listing Trial Measures.See“RiskFactors Risks Relating to Doing Business in the PRC The Opinions,theTrial Measures,and the revised Provisions recently issued by PRC authorities maysubject us to additional compliance requirements in the futur
150、e.”Other than theforegoing,according to our PRC counsel,no relevant laws or regulations in the PRCexplicitly require us to seek approval from the CSRC for our overseas listing.Asof the date of this prospectus,neither we nor our subsidiaries have received anyinquiry,notice,warning,or sanctions regard
151、ing our overseas listing from the CSRCor any other PRC governmental authorities.Since these statements and regulatoryactions are newly published,however,related implementation rules have not beenissued.It is highly uncertain what the potential impact such modified or new lawsand regulations will hav
152、e on the daily business operations of our subsidiaries,ourability to accept foreign investments,and our listing on a U.S.exchange.TheSCNPC or PRC regulatory authorities may in the future promulgate laws,regulations,or implementing rules that require us and our subsidiaries to obtain regulatoryapprov
153、al from Chinese authorities for listing in the U.S.If we do not receive ormaintain the approval,or inadvertently conclude that such approval is notrequired,or applicable laws,regulations,or interpretations change such that weare required to obtain approval in the future,we may be subject to aninvest
154、igation by competent regulators,fines or penalties,or an order prohibitingus from conducting an offering,and these risks could result in a material adversechange in our operations and the value of our Ordinary Shares,significantly limitor completely hinder our ability to offer or continue to offer s
155、ecurities toinvestors,or cause such securities to significantly decline in value or becomeworthless.The same legal and operational risks associated with operations in China also applyto operations in HongKong.HongKong was established as a special administrativeregion of the PRC in accordance with Ar
156、ticle 31 of the Constitution of thePRC.The Basic Law was adopted and promulgated on April 4,1990 and becameeffective on July1,1997,when the PRC resumed the exercise of sovereignty overHongKong.Pursuant to the Basic Law,HongKong is authorized by the NationalPeoples Congress of the PRC to exercise a h
157、igh degree of autonomy and enjoyexecutive,legislative,and independent judicial power,under the principle of“onecountry,two systems,”and the PRC laws and regulations shall not be applied inHongKong except for those listed in AnnexIII of the Basic Law(which is confinedto laws relating to national defe
158、nse,foreign affairs,and other matters that arenot within the scope of autonomy).However,there is no assurance that there willnot be any changes in the economic,political,and legal environment in HongKongin the future.Due to the uncertainty of the PRC legal system and changes in laws,regulations,or p
159、olicies,the Basic Law may be revised in the future and thus wemay face the same legal and operational risks associated with operating in thePRC.If there is a significant change to current political arrangements betweenmainland China and Hong Kong,or if the applicable laws,regulations,orinterpretatio
160、ns change,our HongKong subsidiary may become subject to PRC laws orauthorities.As a result,our HongKong subsidiary could incur material costs toensure compliance,be subject to fines,experience devaluation of securities ordelisting,no longer conduct offerings to foreign investors,and no longer beperm
161、itted to continue their current business operations.3Table of ContentsIn addition,our Ordinary Shares may be prohibited from trading on a nationalexchange under the HFCA Act,if the PCAOB is unable to inspect our auditors for twoconsecutive years beginning in 2022.On December 16,2021,the PCAOB issued
162、 areport on its determinations that it is unable to inspect or investigate completelyPCAOB-registered public accounting firms headquartered in mainland China or inHongKong,a Special Administration Region of the PRC,because of positions takenby PRC authorities in those jurisdictions.Our auditor,WWC,i
163、s headquartered inSan Mateo,California,and has been inspected by the PCAOB on a regular basis,withthe last inspection in 2021.The PCAOB currently has access to inspect the workingpapers of our auditor and our auditor is not subject to the determinationsannounced by the PCAOB on December16,2021,which
164、 determinations were vacated onDecember15,2022.If trading in our Ordinary Shares is prohibited under the HFCAAct in the future because the PCAOB determines that it cannot inspect or fullyinvestigate our auditor at such future time,Nasdaq may determine to delist ourOrdinary Shares and trading in our
165、Ordinary Shares could be prohibited.On June22,2021,the U.S.Senate passed the AHFCAA,and on December29,2022,legislationentitled the Consolidated Appropriations Act was signed into law by PresidentBiden,which contained,among other things,an identical provision to theAccelerating Holding Foreign Compan
166、ies Accountable Act and amended the HFCA Act byrequiring the SEC to prohibit an issuers securities from trading on anyU.S.stock exchanges if its auditor is not subject to PCAOB inspections for twoconsecutiveyears instead of three,thus reducing the time period for triggeringthe prohibition on trading
167、.On August26,2022,the CSRC,the MOF,and the PCAOBsigned the Protocol governing inspections and investigations of accounting firmsbased in mainland China and HongKong,taking the first step toward opening accessfor the PCAOB to inspect and investigate registered public accounting firmsheadquartered in
168、mainland China and HongKong.Pursuant to the fact sheet withrespect to the Protocol disclosed by the SEC,the PCAOB shall have independentdiscretion to select any issuer audits for inspection or investigation and has theunfettered ability to transfer information to the SEC.On December15,2022,thePCAOB
169、Board determined that the PCAOB was able to secure complete access to inspectand investigate registered public accounting firms headquartered in mainland Chinaand HongKong and voted to vacate its previous determinations to the contrary.However,should PRC authorities obstruct or otherwise fail to fac
170、ilitate thePCAOBs access in the future,the PCAOB Board will consider the need to issue a newdetermination.See“Risk Factors Risks Relating to Doing Business in thePRCRecent joint statement by the SEC and the PCAOB,rule changes by Nasdaq,and the HFCA Act all call for additional and more stringent crit
171、eria to be appliedto emerging market companies upon assessing the qualification of their auditors,especially the non-U.S.auditors who are not inspected by the PCAOB.Thesedevelopments could add uncertainties to our continued listing or future offeringsof our securities in the U.S.”Business OverviewWe
172、,through the operating entity,focus on the research,development,manufacturingand sales of veterinary vaccines,with an emphasis on vaccines for livestock.Fornearly 20years,the operating entity has been committed to enhancing the health oflivestock.The operating entity markets a diverse range of vacci
173、nes,includingvaccines for swine,cattle,goats,sheep,poultry,and dogs.The operating entitysproducts are available in 29 provincial regions across China and are exportedoverseas,to Vietnam,Pakistan,and Egypt.For the six months ended June 30,2023 and the fiscalyears ended December31,2022,and 2021,our re
174、venue was RMB116.9 million($16.1 million),RMB260.3million($37.7million),and RMB214.1million($31.0 million),respectively.Competitive StrengthsWe believe the following competitive strengths are essential for our success anddifferentiate us from our competitors:diversified products;high production qual
175、ity;strong research and development capabilities;extensive distribution channels;andexperienced management team and employees.4Table of ContentsGrowth StrategiesWe intend to develop our business and strengthen brand loyalty by implementing thefollowing strategies:develop high-demand products and exp
176、and the operating entitys businessby entering into household animals vaccines industry;expand the operating entitys sales and distribution network;enhance the operating entitys ability to attract,incentivize and retaintalented professionals;increase the investment in production lines;andincrease res
177、earch and development investment.Corporate InformationOur principal executive offices are located at No.1 Lianmeng Road,Jilin Economic&Technical Development Zone,Jilin Province,China and our phone number is+86-.Our registered office in the Cayman Islands is located at3-212 GovernorsSqua
178、re,23 Lime Tree Bay Avenue,P.O.Box 30746,Seven Mile Beach,Grand CaymanKY1-1203,Cayman Islands.We maintain a corporate website at .Theinformation contained in,or accessible from,our website or any other website doesnot constitute a part of this prospectus.Our agent for service of process in theUnited
179、States is Cogency Global Inc.,located at 122 East 42nd Street,18th Floor,New York,NY 10168.Summary of Risk FactorsInvesting in our Ordinary Shares involves significant risks.You should carefullyconsider all of the information in this prospectus before making an investment inour Ordinary Shares.Below
180、 please find a summary of the principal risks we face,organized under relevant headings.These risks are discussed more fully in thesection titled“Risk Factors.”Risks Relating to Doing Business in the PRC(for a more detaileddiscussion,see“Risk Factors Risks Relating to Doing Business inthe PRC”)We fa
181、ce risks and uncertainties relating to doing business in the PRC in general,including,but not limited to,the following:changes in Chinas economic,political,or social conditions orgovernment policies could have a material adverse effect on the operatingentitys business and operations(see page 16 of t
182、his prospectus);uncertainties in the interpretation and enforcement of PRC laws andregulations and changes in policies,rules,and regulations in China,which may be quick with little advance notice,could limit the legalprotection available to you and us(see page 16 of this prospectus);you may experien
183、ce difficulties in effecting service of legal process,enforcing foreign judgments,or bringing actions in China against us orour management named in this prospectus based on foreign laws.It may alsobe difficult for you or overseas regulators to conduct investigations orcollect evidence within China(s
184、ee page 17 of this prospectus);given the Chinese governments significant oversight and discretion overthe conduct of business of the operating entity,the Chinese governmentmay intervene or influence its operations at any time,which could resultin a material change in the operations of the operating
185、entity and/or thevalue of our Ordinary Shares(see page 18 of this prospectus);any actions by the Chinese government,including any decision to interveneor influence the operations of the operating entity or to exert controlover any offering of securities conducted overseas and/or foreigninvestment in
186、 China-based issuers,may cause us to make material changesto the operations of the operating entity,may limit or completely hinderour ability to offer or continue to offer securities to investors,and maycause the value of such securities to significantly decline or beworthless(see page 18 of this pr
187、ospectus);recent greater oversight by the CAC over data security,particularly forcompanies seeking to list on a foreign exchange,could adversely impactour business and our offering(see page 18 of this prospectus);5Table of Contentsthe Opinions recently issued by the General Office of the CentralComm
188、ittee of the Communist Party of China and the General Office of theState Council may subject us and the operating entity to additionalcompliance requirements in the future(see page 19 of this prospectus);recent joint statement by the SEC and the PCAOB,rule changes by Nasdaq,and the Holding Foreign C
189、ompanies Accountable Act all call for additionaland more stringent criteria to be applied to emerging market companiesupon assessing the qualification of their auditors,especially the non-U.S.auditors who are not inspected by the PCAOB.These developmentscould add uncertainties to our offerings(see p
190、age 20 of thisprospectus);to the extent cash or assets in the business are in the PRC/HongKong ora PRC/HongKong entities,the funds or assets may not be available tofund operations or for other use outside of the PRC/Hong Kong due tointerventions in or the imposition of restrictions and limitations o
191、n theability of our Company,our subsidiaries,or the operating entity by thePRC government to transfer cash or assets(see page 21 of thisprospectus);increases in labor costs in the PRC may adversely affect the operatingentitys business and profitability(see page 22 of this prospectus);PRC regulations
192、 relating to offshore investment activities by PRCresidents may subject our PRC resident beneficial owners or the PRCsubsidiaries to liability or penalties,limit our ability to injectcapital into the PRC subsidiaries,limit the PRC subsidiaries ability toincrease their registered capital or distribut
193、e profits to us,or mayotherwise adversely affect us(see page 22 of this prospectus);PRC regulation of parent/subsidiary loans and direct investment byoffshore holding companies to PRC entities may delay or prevent us fromusing the proceeds of offshore offerings to make loans or additionalcapital con
194、tributions to the PRC subsidiaries,which could materially andadversely affect their liquidity and their ability to fund and expandtheir business(see page 24 of this prospectus);fluctuations in exchange rates could have a material and adverse effect onour results of operations and the value of your i
195、nvestment(see page 25 ofthis prospectus);under the PRC Enterprise Income Tax Law,we may be classified as a PRC“resident enterprise”for PRC enterprise income tax purposes.Suchclassification would likely result in unfavorable tax consequences to usand our non-PRC shareholders and have a material adver
196、se effect on ourresults of operations and the value of your investment(see page 25 ofthis prospectus);we face uncertainty with respect to indirect transfers of equity interestsin PRC resident enterprises by their non-PRC holding companies(see page26 of this prospectus);the PRC subsidiaries are subje
197、ct to restrictions on paying dividends ormaking other payments to us,which may have a material adverse effect onour ability to conduct our business(see page 27 of this prospectus);governmental control of currency conversion may affect the value of yourinvestment and our payment of dividends(see page
198、 27 of this prospectus);there are significant uncertainties under the EIT Law relating to thewithholding tax liabilities of the PRC subsidiaries,and dividends payableby our PRC subsidiaries to our offshore subsidiaries may not qualify toenjoy certain treaty benefits(see page 27 of this prospectus);i
199、f we become directly subject to the scrutiny,criticism,and negativepublicity involving U.S.-listed Chinese companies,we may have to expendsignificant resources to investigate and resolve the matter which couldharm our business operations,stock price,and reputation(see page 28 ofthis prospectus);the
200、disclosures in our reports and other filings with the SEC and ourother public pronouncements are not subject to the scrutiny of anyregulatory bodies in the PRC(see page 28 of this prospectus);the approval of the CSRC may be required in connection with this offeringunder the PRC law(see page28 of thi
201、s prospectus);6Table of Contentsthe M&A Rules and certain other PRC regulations establish complexprocedures for certain acquisitions of Chinese companies by foreigninvestors,which could make it more difficult for us to pursue growththrough acquisitions in China(see page 30 of this prospectus);andChi
202、nese regulatory authorities could disallow our holding companystructure,which may result in a material change in our operations and/ora material change in the value of the securities we are registering forsale,including that it could cause the value of such securities tosignificantly decline or beco
203、me worthless(see page 30 of thisprospectus).Risks Relating to Our Business and Industry(for a more detaileddiscussion,see“Risk Factors Risks Related to Our Business andIndustry”)Risks and uncertainties related to our business include,but are not limited to,the following:the operating entity operates
204、 in a highly-competitive market and ourfailure to compete effectively could adversely affect its results ofoperations(see page 31 of this prospectus);perceived adverse effects on human health linked to the consumption offood derived from animals that utilize the operating entitys productscould cause
205、 a decline in the sales of such products(see page 32 of thisprospectus);increased regulation relating to the raising,processing or consumption offood-producing animals could reduce demand for the operating entityslivestock products(see page 32 of this prospectus);the operating entitys business is su
206、bject to risk based on customerexposure to rising costs and reduced customer income(see page 32 of thisprospectus);the operating entity may not successfully acquire and integrate otherbusinesses,license rights to technologies or products,form and managealliances or divest businesses(see page 32 of t
207、his prospectus);the operating entitys research and development,acquisition andlicensing efforts may fail to generate new products and brand life-cycledevelopments(see page 33 of this prospectus);advances in veterinary medical practices and animal health technologiescould negatively affect the market
208、 for the operating entitys products(see page 33 of this prospectus);the operating entitys research and development relies on evaluations inanimals(see page 33 of this prospectus);manufacturing problems may cause product launch delays,inventoryshortages,recalls or unanticipated costs(see page 33 of t
209、hisprospectus);the operating entity may fail to detect or cure defects of its products(see page 34 of this prospectus);the misuse or off-label use of the operating entitys products may harmthe operating entitys reputation or result in financial or other damages(see page 34 of this prospectus);We der
210、ive a significant portion of our revenue from swine vaccines and anyreduction in demand of swine vaccines could have an adverse effect on ourbusiness,financial condition,results of operations,cash flows,andprospects(see page 35 of this prospectus);animal health products are subject to unanticipated
211、safety or efficacyconcerns,which may harm the operating entitys reputation(see page 35of this prospectus);operating entitys historical growth rates and performance may not besustainable or indicative of our future growth and financial results.Wecannot guarantee that we will be able to maintain the g
212、rowth rate we haveexperienced to date(see page 35 of this prospectus);COVID-19 affects our results of operations(see page 35 of thisprospectus);the operating entitys business is subject to inherent risks relating toproduct liability(see page 36 of this prospectus);7Table of Contentsthe operating ent
213、itys business will be materially and adversely affectedif its collaborative partners,licensees and other third parties over whomthe operating entity is very dependent fail to perform as expected(seepage 36 of this prospectus);the operating entitys business requires a number of permits andlicenses.We
214、 cannot assure you that the operating entity can maintain allrequired licenses,permits and certifications to carry on its business atall times(see page 36 of this prospectus);the operating entitys ability to generate more revenue would beadversely affected if it needs more clinical trials or take mo
215、re time tocomplete its clinical trials than it has planned(see page 37 of thisprospectus);if we cannot retain,attract,and motivate key personnel,we may be unableto effectively implement our business plan(see page 37 of thisprospectus);if the operating entity is unable to obtain the regulatory approv
216、als orclearances that are necessary to commercialize its products,we will haveless revenue than expected(see page 37 of this prospectus);The operating entity sources its raw materials used for manufacturing froma limited number of suppliers.If it loses one or more of the suppliers,its operation may
217、be disrupted,and both the operating entitys and ourresults of operations may be adversely and materially impacted(see page38 of this prospectus);high customer concentration exposes the operating entity to all of therisks faced by its major customer and may subject it to significantfluctuations or de
218、clines in revenue,which may have a material adverseimpact on the operating entitys business,and its and our financialcondition and results of operations(see page 38 of this prospectus);damage to our brand image could have a material adverse effect on ourgrowth strategy and our business,financial con
219、dition,results ofoperations and prospects(see page 39 of this prospectus);if the operating entity cannot successfully protect its intellectualproperty and exclusive rights,our brand and business would suffer(seepage 39 of this prospectus);the operating entity may be accused of infringing,misappropri
220、ating orotherwise violating the intellectual property rights of third parties(seepage 40 of this prospectus);we are subject to legal and regulatory proceedings from time to time inthe ordinary course of our business(see page 40 of this prospectus);andwe could be adversely affected by violations of t
221、he U.S.Foreign CorruptPractices Act and similar worldwide anti-bribery laws(see page 40 of thisprospectus).Risks Relating to this Offering and the Trading Market(for a moredetailed discussion,see“Risk Factors Risks Relating to thisOffering and the Trading Market”)In addition to the risks described a
222、bove,we are subject to general risks anduncertainties relating to this offering and the trading market,including,but notlimited to,the following:there has been no public market for our Ordinary Shares prior to thisoffering,and you may not be able to resell our Ordinary Shares at orabove the price yo
223、u pay for them,or at all(see page 41 of thisprospectus);the initial public offering price for our Ordinary Shares may not beindicative of prices that will prevail in the trading market and suchmarket prices may be volatile(see page 41 of this prospectus);you will experience immediate and substantial
224、 dilution in the net tangiblebook value of Ordinary Shares purchased(see page 41 of this prospectus);if we fail to implement and maintain an effective system of internalcontrols or fail to remediate the material weaknesses in our internalcontrol over financial reporting that have been identified,we
225、may fail tomeet our reporting obligations or be unable to accurately report ourresults of operations or prevent fraud,and investor confidence and themarket price of our Ordinary Shares may be materially and adverselyaffected(see page 41 of this prospectus);8Table of Contentswe will incur substantial
226、 increased costs as a result of being a publiccompany(see page 42 of this prospectus);substantial future sales of our Ordinary Shares or the anticipation offuture sales of our Ordinary Shares in the public market could cause theprice of our Ordinary Shares to decline(see page 42 of this prospectus);
227、we do not intend to pay dividends in the foreseeable future(see page 43of this prospectus);if securities or industry analysts do not publish research or reportsabout our business,or if they publish a negative report regarding ourOrdinary Shares,the price of our Ordinary Shares and trading volume cou
228、lddecline(see page 43 of this prospectus);the market price of our Ordinary Shares may be volatile or may declineregardless of our operating performance,and you may not be able to resellyour shares at or above the initial public offering price(see page 43 ofthis prospectus);the price of our Ordinary
229、Shares could be subject to rapid and substantialvolatility.Such volatility,including any stock run-ups,may be unrelatedto our actual or expected operating performance and financial condition orprospects,making it difficult for prospective investors to assess therapidly changing value of our Ordinary
230、 Shares(see page 44 of thisprospectus);our management has broad discretion to determine how to use the fundsraised in the offering and may use them in ways that may not enhance ourresults of operations or the price of our Ordinary Shares(see page 44 ofthis prospectus);if we cease to qualify as a for
231、eign private issuer,we would be requiredto comply fully with the reporting requirements of the Exchange Actapplicable to U.S.domestic issuers,and we would incur significantadditional legal,accounting and other expenses that we would not incur asa foreign private issuer(see page 44 of this prospectus
232、);because we are a foreign private issuer and intend to take advantage ofexemptions from certain Nasdaq corporate governance standards applicableto U.S.issuers,you will have less protection than you would have if wewere a domestic issuer(see page 44 of this prospectus);andif we cannot continue to sa
233、tisfy the listing requirements and other rulesof the Nasdaq,our securities may be delisted,which could negativelyimpact the price of our securities and your ability to sell them(see page45 of this prospectus).Impact of the COVID-19 PandemicThe COVID-19 pandemic has resulted in the implementation of
234、significantgovernmental measures,including lockdowns,closures,quarantines,and travel bans,intended to control the spread of the virus.In January 2020,the Chinesegovernment issued a series of policies to prevent the spread of COVID-19.InMarch 2022,a new wave of COVID-19 outbreak hit Jilin Province,pa
235、rticularlyChangchun City and Jilin City.The resulting closure measures lasted for aroundtwomonths and significantly impacted the social and industrial activities of JilinCity,where the operating entity is situated.Particularly,the area where theoperating entity operates was classified as a high-risk
236、 zone.As a result,theoperating entitys operational performance was affected.For the fiscal years ended December 31,2022 and 2021,the Company and theoperating entity did not experience a significant negative impact of COVID-19 ontheir operations,capital,and financial position.Our revenue reachedappro
237、ximately RMB260.3 million($37.7 million)for the fiscal year endedDecember31,2022,representing an increase of approximately RMB46.2million or21.6%from approximately RMB214.1million($31.0 million)for the fiscal year endedDecember31,2021.For the six months ended June 30,2023 and 2022,the Company and th
238、e operatingentity did not experience a significant negative impact of COVID-19 on theiroperations,capital,and financial position.Our revenue reached approximatelyRMB116.9 million($16.1 million)for the six months ended June 30,2023,representing a slight decrease of approximately RMB6.5 million or 5.3
239、%fromapproximately RMB123.4 million($17.0 million)for the six months ended June 30,2022.9Table of ContentsIn December 2022,the COVID-19 restriction policies in China were graduallyloosened and lifted,both locally and nationally.Starting from January2023,amongother changes,China no longer conducts nu
240、cleic acid tests and centralizedquarantine for all inbound travelers,and measures to control the number ofinternational passenger flights are lifted.The extent of the impact of COVID-19 on the Companys future financial results willbe dependent on future developments such as the length and severity o
241、f thepandemic,the potential resurgence of the pandemic,future government actions inresponse to the pandemic and the overall impact of the COVID-19 pandemic on theglobal economy and capital markets,among many other factors,all of which remainhighly uncertain and unpredictable.Given this uncertainty,t
242、he Company iscurrently unable to quantify the expected impact of the COVID-19 pandemic on itsfuture operations,financial condition,liquidity and results of operations if thecurrent situation continues.See“Risk FactorsRisks Related to Our Businessand IndustryCOVID-19 Affects our Results of Operations
243、.”Permissions or Approval Required from the PRC Authorities for theOperating EntityOur PRC legal counsel,Guantao,has advised us that,as of the date of thisprospectus,the operating entity has obtained and currently maintain all approvals,permits,licenses,registrations or filings from PRC authorities
244、needed to engagein the businesses currently conducted in China.Such permits,licenses,registrations and permissions(the“Governmental Permits”)include,but are notlimited to,the following:1.Business License,which is a permit issued by Market Supervision andAdministration that allows companies to conduc
245、t specific businesses withinthe governments geographical jurisdiction;2.Certificate of Good Manufacturing Practice for Animal Drugs(“GMP”),which is a quality management standard for veterinary drug productionissued by the Animal Husbandry Administration of Jilin Province;3.Veterinary Drug Production
246、 License,which is a permit issued by JilinAnimal Husbandry Bureau that allows companies to produce veterinary drugs;4.Veterinary Drug Operation License,which is a permit issued by JilinAnimal Husbandry Bureau that allows companies to deal in veterinary drugs;5.Use License of Experimental Animals,whi
247、ch is a permit issued byDepartment of Science and Technology of Jilin Province that allowscompanies to conduct scientific experiments or studies using animals;6.Registration Certificate of New Veterinary Drugs,which is a permit issuedby Ministry of Agriculture and Rural Affairs of the PRC that allow
248、scompanies to apply for approval document numbers of veterinary drugproducts,with which companies can manufacture a new veterinary drug;and7.Pollutant Discharge Permit,which is a permit issued by Jilin CityEcological Environment Bureau in the PRC that allows companies todischarge pollutants in accor
249、dance with regulations.We cannot assure you that the operating entity will always be able to successfullyupdate or renew the Governmental Permits required for the relevant business in atimely manner or that these licenses or permits are sufficient to conduct all ofthe operating entitys present or fu
250、ture business.The operating entitysoperations could be adversely affected,directly or indirectly;our ability tooffer,or continue to offer,securities to investors would be potentially hindered;and the value of our securities might significantly decline or be worthless,byexisting or future laws and re
251、gulations relating to the business of thesubsidiaries and the operating entity or our industry,or by intervention orinterruption by PRC governmental authorities,if we or the operating entity(1)donot receive or maintain such Governmental Permits,(2)inadvertently conclude thatsuch Governmental Permits
252、 are not required,(3)applicable laws,regulations,orinterpretations change and the operating entity is required to obtain suchGovernmental Permits in the future.Permissions or Approval Required from the PRC Authorities for OverseasListingAs of the date of this prospectus,our PRC counsel,Guantao,has a
253、dvised us thatneither we nor any of the PRC subsidiaries(1)is required to obtain permissionfrom any of the PRC authorities to operate and issue our Ordinary Shares to foreigninvestors except for the filing with the CSRC for this offering,and(2)has beendenied such permissions by any PRC authorities.1
254、0Table of ContentsRecently,however,the General Office of the Central Committee of the CommunistParty of China and the General Office of the State Council jointly issued the“Opinions on Severely Cracking Down on Illegal Securities Activities According toLaw,”or the“Opinions,”which were made available
255、 to the public on July6,2021.The Opinions emphasized the need to strengthen the administration overillegal securities activities and the need to strengthen the supervision overoverseas listings by Chinese companies.These opinions proposed to take effectivemeasures,such as promoting the construction
256、of relevant regulatory systems,todeal with the risks and incidents facing China-concept overseas-listed companiesand the demand for cybersecurity and data privacy protection.The Cybersecurity Review Measures,which became effective on February15,2022,provide that,in addition to CIIOs that intend to p
257、urchase Internet products andservices,online platform operators engaging in data processing activities thataffect or may affect national security must be subject to cybersecurity review bythe Cybersecurity Review Office of the PRC.According to the Cybersecurity ReviewMeasures,a cybersecurity review
258、assesses potential national security risks thatmay be brought about by any procurement,data processing,or overseas listing.TheCybersecurity Review Measures further require that online platform operators thatpossess personal data of at least one million users must apply for a review by theCybersecuri
259、ty Review Office of the PRC before conducting listings in foreigncountries.On November14,2021,the CAC published the Regulations on Network Data SecurityProtection(Draft for Comments),or the Security Administration Draft,for publiccomments,which reiterated that data processors that process personal i
260、nformationof more than one million users listing in a foreign country should apply for acybersecurity review.As of the date of this prospectus,the SecurityAdministration Draft has not been enacted.Based on the description regarding our business operations and our marketplace,neither we or the operat
261、ing entity are required to go through a cybersecurityreview with the CAC,because we and the operating entity are not an operator ofCIIOs or an online platform operator that possesses over one million userspersonal information.Based on the foregoing and also the advice of our PRC legalcounsel,Guantao
262、,we believe that we and the operating entity are currently notrequired to go through a cybersecurity review with the CAC as of the date hereof.As of the date of this prospectus,we and the operating entity have also not beeninvolved in any investigations on cybersecurity or data security initiated by
263、related governmental regulatory authorities,and we have not received any inquiry,notice,warning,or sanction in such respect.There remains uncertainty,however,as to how the Cybersecurity Review Measures will be interpreted or implemented andwhether the PRC over data security,particularly for companie
264、s seeking to list on aforeign exchange,could adversely impact our PRC subsidiaries business and ouroffering.On February17,2023,the CSRC promulgated the Overseas Listing Trial Measures andrelevant five guidelines,which became effective on March31,2023.According tothe Overseas Listing Trial Measures,P
265、RC domestic companies that seek to offer andlist securities in overseas markets,either in direct or indirect means,arerequired to fulfill the filing procedure with the CSRC and report relevantinformation.Based on the foregoing,our PRC counsel is of the view that we arerequired to complete the filing
266、 procedures with the CSRC in connection with theoffering and listing.There is no assurance that we can complete such filing in atimely manner or even at all.Any failure by us to comply with such filingrequirements may result in orders to rectify,warnings and fines against us andcould materially hind
267、er our ability to offer or continue to offer our securities.We have filed with the CSRC the filing documents and shall complete the filingbefore the completion of our overseas offering and listing.Given the current PRCregulatory environment,it is uncertain whether we will be required to obtainapprov
268、als from the PRC government to offer securities to foreign investors in thefuture,and whether we would be able to obtain such approvals.If we are unable toobtain such approvals in the future,then the value of our Ordinary Shares maydepreciate significantly or become worthless.See“Regulations Regulat
269、ionsRelating to Overseas Listings”and“Risk Factors Risks Relating to DoingBusiness in the PRCThe Opinions recently issued by the General Office of theCentral Committee of the Communist Party of China and the General Office of theState Council may subject us and the operating entity to additional com
270、pliancerequirements in the future.”Asset Transfers Between Our Company and Our SubsidiariesAs of the date of this prospectus,except for a loan from the operating entity toHainan Senhan on October 10,2023,with a principal amount of RMB100,000,no cashtransfer or transfer of other assets has occurred b
271、etween our Company and oursubsidiaries.During the six months ended June 30,2023 and the fiscal years endedDecember 31,2022 and 2021,dividends and distributions made by the operatingentity to its original shareholders amounted to RMB18,000,000,RMB21,424,500,andRMB11,047,500,respectively.On April 28,2
272、023,the shareholders of the operatingentity passed the resolution of the dividend plan for 2022,with the dividendamount of RMB55,104,000,and11Table of Contentsthe dividend will be distributed before May 2024.Apart from the aforementioned,there is no other transfers,dividends,or distributions between
273、 the Companyssubsidiaries as of the date of this prospectus.We have established controls andprocedures for cash flows within our organization based on internal cash managementpolicies established by our finance department,discussed,considered,and reviewedby the relevant departments in our Company,an
274、d approved by our Chairman of theBoard of Directors.Specifically,our finance department supervises cashmanagement,following the instructions of our management.Our finance department isresponsible for establishing our cash operation plan and coordinating cashmanagement matters among our subsidiaries
275、and departments.Each subsidiary anddepartment initiate a cash request by putting forward a cash demand plan,whichexplains the specific amount and timing of cash requested,and submitting it to ourfinance department.The finance department reviews the cash demand plan andprepares a summary for the mana
276、gement of our Company.Management examines andapproves the allocation of cash based on the sources of cash and the priorities ofthe needs.Other than the above,we currently do not have other cash managementpolicies or procedures that dictate how funds are transferred.Dividends or Distributions Made to
277、 Our Company and U.S.Investors andTax ConsequencesDuring the six months ended June 30,2023 and the fiscalyears ended December31,2022 and 2021,dividends and distributions made by the operating entity to itsoriginal shareholders amounted to RMB18,000,000,RMB21,424,500,and RMB11,047,500,respectively.On
278、 April28,2023,the shareholders of the operating entity passedthe resolution of the dividend plan for 2022,with the dividend amount ofRMB55,104,000,and the dividend will be distributed before May2024.Except as disclosed above,we intend to keep any future earnings to finance theexpansion of our busine
279、ss,and we do not anticipate that any cash dividends will bepaid in the foreseeable future.Subject to the passive foreign investment company(“PFIC”)rules,the gross amount of distributions we make to investors withrespect to our Ordinary Shares(including the amount of any taxes withheldtherefrom)will
280、be taxable as a dividend,to the extent that the distribution ispaid out of our current or accumulated earnings and profits,as determined underU.S.federal income tax principles.Under the Cayman Islands law,a Cayman Islands company may pay a dividend on itsshares out of profit and/or share premium,pro
281、vided that in no circumstances may adividend be paid out of share premium if this would result in the company beingunable to pay its debts as they fall due in the ordinary course of business.If we determine to pay dividends on any of our Ordinary Shares in the future,as aholding company,we will be d
282、ependent on receipt of funds from our Hong Kongsubsidiary.There are currently no restrictions on foreign exchange and our abilityto transfer cash among our Cayman Islands holding company and our subsidiary in BVIand Hong Kong.However,as the PRC government imposes control over currencyconversion,it h
283、as the authority to conduct exchange transfer reviews,which mayimpose certain limitations on our ability to transfer cash between our Company,oursubsidiaries,and our investors,primarily reflected in the following aspects:(i)we are restricted from injecting capital or providing loans to our PRCsubsid
284、iaries,which may adversely affect the operations of our PRC subsidiaries;(ii)our PRC subsidiaries may be restricted from paying dividends to us;and(iii)if we are unable to obtain dividends from our PRC subsidiaries,it mayadversely impact our dividends distribution to investors.See“Summary of RiskFac
285、tors,”“Risk FactorsRisks Relating to Doing Business in the PRCPRCregulations relating to offshore investment activities by PRC residents may subjectour PRC resident beneficial owners or our PRC subsidiaries to liability orpenalties,limit our ability to inject capital into our PRC subsidiaries,limit
286、ourPRC subsidiaries ability to increase their registered capital or distributeprofits to us,or may otherwise adversely affect us,”“Risk FactorsRisksRelating to Doing Business in the PRCPRC regulation of parent/subsidiary loansand direct investment by offshore holding companies to PRC entities may de
287、lay orprevent us from using the proceeds of offshore offerings to make loans oradditional capital contributions to our PRC subsidiaries,which could materiallyand adversely affect their liquidity and their ability to fund and expand theirbusiness,”and“Risk Factors Risks Relating to Doing Business in
288、thePRCGovernmental control of currency conversion may affect the value of yourinvestment and our payment of Dividends.”Current PRC regulations permit PRC subsidiaries to pay dividends to PegBiotechnology only out of its accumulated profits,if any,determined in accordancewith Chinese accounting stand
289、ards and regulations.The PRC government also imposescontrols on the conversion of RMB into foreign currencies and the remittance ofcurrencies out of the PRC.For instance,the Circular on Promoting the Reform ofForeign Exchange Management and Improving Authenticity and Compliance Review,or“SAFE Circul
290、ar 3,”issued on January26,2017,provides that banks shall,whendealing with dividend remittance transactions from a domestic enterprise to itsoffshore shareholders of more than$50,000,review the relevant board resolutions,original tax filing form,and audited financial statements of such12Table of Cont
291、entsdomestic enterprise based on the principle of genuine transaction.Furthermore,ifour PRC subsidiaries incur debt on their own in the future,the instrumentsgoverning the debt may restrict their ability to pay dividends or make otherpayments.If we or our PRC subsidiaries are unable to receive all o
292、f the revenuefrom its operations,we may be unable to pay dividends on our Ordinary Shares.Cash dividends,if any,on our Ordinary Shares will be paid in U.S.dollars.PegBiotechnology may be considered a non-resident enterprise for tax purposes,so thatany dividends our PRC subsidiaries pay to Peg Biotec
293、hnology may be regarded asChina-sourced income and as a result may be subject to PRC withholding tax at arate of up to 10%.See“Material Income Tax ConsiderationPeoples Republicof China Enterprise Taxation in Mainland China.”As a holding company,we may rely on dividends and other distributions on equ
294、itypaid by our subsidiaries,including those based in mainland China,for our cash andfinancing requirements.If any of our PRC subsidiaries incurs debt on its ownbehalf in the future,the instruments governing such debt may restrict its abilityto pay dividends to us.Pursuant to the Arrangement between
295、Mainland China and the Hong Kong SpecialAdministrative Region for the Avoidance of Double Taxation and Tax Evasion onIncome(the“Double Tax Avoidance Arrangement”),the 10%withholding tax rate maybe lowered to 5%if a HongKong resident enterprise owns no less than 25%of a PRCresident enterprise.The 5%w
296、ithholding tax rate,however,does not automaticallyapply and certain requirements must be satisfied,including without limitation that(a)the HongKong resident enterprise must directly own the required percentage ofequity interests and voting rights in the PRC resident enterprise;and(b)theHongKong resi
297、dent enterprise must have directly owned such required percentage inthe PRC resident enterprise throughout the 12 months prior to receiving of thedividends.In current practice,a HongKong resident enterprise must obtain a taxresident certificate from the HongKong tax authority to apply for the 5%lowe
298、r PRCwithholding tax rate.As the HongKong tax authority will issue such a tax residentcertificate on a case-by-case basis,we cannot assure you that we will be able toobtain the tax resident certificate from the relevant HongKong tax authority andenjoy the preferential withholding tax rate of 5%under
299、 the Double Tax AvoidanceArrangement with respect to any dividends paid by Hainan Senhan to its immediateholding company,Peg Biotechnology.As of the date of this prospectus,we have notapplied for the tax resident certificate from the relevant HongKong tax authority.Peg Biotechnology intends to apply
300、 for the tax resident certificate if and whenHainan Senhan plans to declare and pay dividends to Peg Biotechnology.See“RiskFactorsRisks Relating to Doing Business in the PRCThere are significantuncertainties under the EIT Law relating to the withholding tax liabilities of ourPRC subsidiary,and divid
301、ends payable by our PRC subsidiaries to our offshoresubsidiaries may not qualify to enjoy certain treaty benefits.”Implications of Being an“Emerging Growth Company”As a company with less than$1.235billion in revenue during our last fiscal year,we qualify as an“emerging growth company”as defined in t
302、he Jumpstart OurBusiness Startups Actof2012,or the“JOBS Act.”An“emerging growth company”may take advantage of reduced reporting requirements that are otherwise applicableto larger public companies.In particular,as an emerging growth company,we:may present only two years of audited financial statemen
303、ts and onlytwoyears of related Managements Discussion and Analysis of FinancialCondition and Results of Operations;are not required to provide a detailed narrative disclosure discussing ourcompensation principles,objectives and elements and analyzing how thoseelements fit with our principles and obj
304、ectives,which is commonlyreferred to as“compensation discussion and analysis”;are not required to obtain an attestation and report from our auditors onour managements assessment of our internal control over financialreporting pursuant to the Sarbanes-Oxley Actof2002;are not required to obtain a non-
305、binding advisory vote from ourshareholders on executive compensation or golden parachute arrangements(commonly referred to as the“say-on-pay,”“say-on frequency,”and“say-on-golden-parachute”votes);are exempt from certain executive compensation disclosure provisionsrequiring a pay-for-performance grap
306、h and CEO pay ratio disclosure;are eligible to claim longer phase-in periods for the adoption of new orrevised financial accounting standards under 107 of the JOBS Act;and13Table of Contentswill not be required to conduct an evaluation of our internal control overfinancial reporting until our second
307、 annual report on Form20-F followingthe effectiveness of our initial public offering.We intend to take advantage of all of these reduced reporting requirements andexemptions,including the longer phase-in periods for the adoption of new orrevised financial accounting standards under 107 of the JOBS A
308、ct.Our election touse the phase-in periods may make it difficult to compare our financial statementsto those of non-emerging growth companies and other emerging growth companies thathave opted out of the phase-in periods under 107 of the JOBS Act.Under the JOBS Act,we may take advantage of the above
309、-described reduced reportingrequirements and exemptions until we no longer meet the definition of an emerginggrowth company.The JOBS Act provides that we would cease to be an“emerging growthcompany”at the end of the fiscal year in which the fifth anniversary of ourinitial sale of common equity pursu
310、ant to a registration statement declaredeffective under the Securities Act occurred,if we have more than$1.235billion inannual revenue,have more than$700million in market value of our Ordinary Sharesheld by non-affiliates,or issue more than$1billion in principal amount of non-convertible debt over a
311、 three-year period.Foreign Private Issuer StatusWe are a foreign private issuer within the meaning of the rules under theSecurities ExchangeActof1934,as amended(the“ExchangeAct”).As such,weare exempt from certain provisions applicable to United States domestic publiccompanies.For example:we are not
312、required to provide as many Exchange Act reports,or asfrequently,as a domestic public company;for interim reporting,we are permitted to comply solely with our homecountrys requirements,which are less rigorous than the rules that applyto domestic public companies;we are not required to provide the sa
313、me level of disclosure on certainissues,such as executive compensation;we are exempt from provisions of Regulation FD aimed at preventingissuers from making selective disclosures of material information;we are not required to comply with the sections of the Exchange Actregulating the solicitation of
314、 proxies,consents,or authorizations inrespect of a security registered under the ExchangeAct;andwe are not required to comply with Section 16 of the Exchange Actrequiring insiders to file public reports of their share ownership andtrading activities and establishing insider liability for profits rea
315、lizedfrom any“short-swing”trading transaction.Controlled CompanyUpon completion of this offering,our director,chairman of the board of directorsand largest shareholder,Mr.Zhenfa Han,will beneficially own approximately%of the aggregate voting power of our issued and outstanding Ordinary Shares.As are
316、sult,we will be deemed a“controlled company”for the purpose of the Nasdaqlisting rules.As a controlled company,we are permitted to elect to rely oncertain exemptions from the obligations to comply with certain corporate governancerequirements,including the requirements that:a majority of our board o
317、f directors consist of independent directors;our director nominees be selected or recommended solely by independentdirectors;andwe have a nominating and corporate governance committee and a compensationcommittee that are composed entirely of independent directors with awritten charter addressing the
318、 purposes and responsibilities of thecommittees.Although we do not intend to rely on the controlled company exemptions under theNasdaq listing rules even if we are a controlled company,we could elect to rely onthese exemptions in the future,and if so,you would not have the same protectionafforded to
319、 shareholders of companies that are subject to all of the corporategovernance requirements of Nasdaq.See“Risk Factors”and“ManagementControlled Company.”14Table of ContentsTHE OFFERINGOrdinary Shares offered by us Ordinary SharesPrice per Ordinary Share We currently estimate that the initial publicof
320、fering price will be in the range of$to$per Ordinary Share.Ordinary Shares outstandingprior to completion of thisoffering 11,416,594Ordinary Shares issued andoutstandingOrdinary Shares outstandingimmediately after thisoffering Ordinary SharesListing We will apply to have our Ordinary Shares listedon
321、 the Nasdaq Global Market.The closing of thisoffering is conditioned upon Nasdaqs finalapproval of our listing application,and there isno guarantee or assurance that our OrdinaryShares will be approved for listing on Nasdaq.Proposed ticker symbol“ZYBT”Transfer Agent Transhare CorporationUse of proce
322、eds We intend to use the proceeds from this offeringto acquire vaccine production companies,buildnew workshops,conduct research and developmentprojects,and for working capital and othergeneral corporate purposes.See“Use ofProceeds”on page 50 for more information.Lock-up We,and any successors of us,w
323、ill not,withoutthe prior written consent of the Representative,for one hundred eighty(180)days from the dateof commencement of sales of this offering,(i)offer,pledge,sell,contract to sell,sellany option or contract to purchase,purchase anyoption or contract to sell,grant any option,right,or warrant
324、to purchase,lend,or otherwisetransfer or dispose of,directly or indirectly,any of our Ordinary Shares or any securities thatare convertible into or exercisable orexchangeable for our Ordinary Shares,(ii)fileor cause to be filed any registration statementwith the SEC relating to the offering of anyOr
325、dinary Shares or any securities convertibleinto or exercisable or exchangeable for OrdinaryShares,or(iii)complete any offering of ourdebt securities,other than entering into a lineof credit with a traditional bank,or(iv)enterinto any swap or other arrangement that transfersto another,in whole or in
326、part,any of theeconomic consequences of ownership of ourcapital shares,whether any such transactiondescribed in clause(i),(ii),(iii),or(iv)above is to be settled by delivery ofshares of our Company or such othersecurities,in cash or otherwise.Furthermore,all of ourdirectors,officers,5%or greater sha
327、reholdershave agreed with the underwriters,subject tocertain exceptions,not to offer,pledge,sell,contract to sell,sell any option or contract topurchase,purchase any option or contract tosell,grant any option,right or warrant topurchase,lend or otherwise transfer,or disposeof,directly or indirectly,
328、any of our OrdinaryShares or securities convertible into orexercisable or exchangeable for our OrdinaryShares for one hundred eighty(180)days fromthe date of commencement of sales of thisoffering.See“UnderwritingLock-UpAgreements”for more information.Risk factors The Ordinary Shares offered hereby i
329、nvolve a highdegree of risk.You should read“Risk Factors,”beginning on page 16 for a discussion of factorsto consider before deciding to invest in ourOrdinary Shares.15Table of ContentsRISK FACTORSAn investment in our Ordinary Shares involves a high degree of risk.Before decidingwhether to invest in
330、 our Ordinary Shares,you should consider carefully the risksdescribed below,together with all of the other information set forth in thisprospectus,including the section titled“Managements Discussion and Analysis ofFinancial Condition and Results of Operations”and our consolidated financialstatements
331、 and related notes.If any of these risks actually occurs,our business,financial condition,results of operations,or cash flow could be materially andadversely affected,which could cause the trading price of our Ordinary Shares todecline,resulting in a loss of all or part of your investment.The risks
332、describedbelow and discussed in other parts of this prospectus are not the only ones that weface.Additional risks not presently known to us or that we currently deem immaterialmay also affect our business.You should only consider investing in our OrdinaryShares if you can bear the risk of loss of yo
333、ur entire investment.Risks Relating to Doing Business in the PRCChanges in Chinas economic,political,or social conditions or governmentpolicies could have a material adverse effect on the operating entitysbusiness and operations.All of the operating entitys assets and our operations are currently located inChina.Accordingly,the operating entitys business,financial condition,results ofoperations,an