{"url_path":"/sec/ocg/10-k/2026/item-10","section_key":"item-10","section_title":"Item 10 ADDITIONAL INFORMATION**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-14","source_url":"https://www.sec.gov/Archives/edgar/data/1776067/0001213900-26-056688-index.html","accession_number":"0001213900-26-056688","cik":"0001776067","ticker":"OCG","issuer_name":"Oriental Culture Holding LTD","edgar_url":"https://www.sec.gov/Archives/edgar/data/1776067/0001213900-26-056688-index.html","primary_entity_key":"0001776067","primary_entity_name":"Oriental Culture Holding LTD"},"word_count":8716,"has_tables":true,"body_markdown":"** **\n\n**ITEM 10. ADDITIONAL INFORMATION**\n\n** **\n\n**10.A. Share Capital**\n\n** **\n\nNot Applicable.\n\n**  **\n\n**10.B. Memorandum and Articles of Association**\n\n** **\n\nWe are a Cayman Islands exempted company limited\nby shares and our affairs are governed by our current memorandum and articles of association and the Companies Act (As Revised) of the\nCayman Islands, which we refer to as the “Companies Act” below, and the common law of the Cayman Islands.\n\n \n\nOur authorized share capital is $5,505,000 divided\ninto shares of which (x) 33,333,333 shares are designated as ordinary shares with a par value of $0.165 per share, and (y) 100,000,000\nshares are designated as preferred shares with a nominal or par value of $0.00005 per share.  As of May 12, 2026, 1,938,312\nordinary shares and 12,000,000 preferred shares are issued and outstanding.\n\n \n\nOur shareholders adopted our Fourth Amended and\nRestated Memorandum and Articles of Association by way of a special resolution on March 20, 2026.\n\n \n\nOn April 3, 2026, the Company implemented a 1-for-3 reverse split/share\nconsolidation for its ordinary shares, and such consolidation change was submitted to Cayman Registrar on April 8, 2026 and reflected\nin the authorized share capital numbers above.\n\n \n\nOur registered office in the Cayman Islands is located at P.O. Box\n31119 Grand Pavilion, Hibiscus Way, 802 West Bay Road, Grand Cayman, KY1-1205, Cayman Islands\n\n \n\nAccording to clause 3 of our current amended and\nrestated memorandum of association, the objects for which the Company is established are unrestricted and the Company shall have full\npower and authority to carry out any object not prohibited by The Companies Act (As Amended) or as the same may be amended from time to\ntime, or any other law of the Cayman Islands.\n\n \n\nThe following are summaries of material provisions\nof our current memorandum and articles of association, insofar as they relate to the material terms of our ordinary shares.\n\n \n\n**Board of Directors**\n\n** **\n\nSee “*Item 6. Directors, Senior Management\nand Employees*.”\n\n \n\n97\n\n \n\n \n\n**Ordinary Shares**\n\n** **\n\n*Dividends.* Subject to the provisions of the Cayman Companies Act and any rights\nof any class or series of shares, our board of directors may, from time to time, declare dividends on the shares issued and authorize\npayment of the dividends out of our lawfully available funds. No dividends shall be declared by the board out of our company except the\nfollowing:\n\n \n\n \n●\nprofits; or\n\n \n\n \n●\n“share premium account,” which represents the excess of the price paid to our company on issue of its shares over the par or “nominal” value of those shares, which is similar to the U.S. concept of additional paid in capital.\n\n \n\nHowever, no dividend shall bear interest against\nthe Company.\n\n \n\n*Voting Rights.*  The holders of\nour ordinary shares are entitled to one vote per share, including the election of directors. Voting at any meeting of shareholders is\nby show of hands unless a poll is demanded. On a show of hands every shareholder present in person or by proxy shall have one vote.  On\na poll every shareholder entitled to vote (in person or by proxy) shall have one vote for each share for which he/she is the holder. A\npoll may be demanded by the chairman or one or more shareholders present in person or by proxy holding not less than 10 percent of the\npaid up share capital of the Company entitled to vote. A quorum required for a meeting of shareholders consists of shareholders who hold\nat least one-third of our issued and outstanding shares entitled to vote at the meeting present in person or by proxy and that any holder\nof shares of the class present in person or by proxy may demand a poll. While not required by our articles of association, a proxy form\nwill accompany any notice of general meeting convened by the directors to facilitate the ability of shareholders to vote by proxy.\n\n  \n\nAny ordinary resolution to be made by the shareholders\nrequires the affirmative vote of a simple majority of the votes of the issued and outstanding ordinary shares cast in a general meeting,\nwhile a special resolution requires the affirmative vote of no fewer than two-thirds of the votes of the issued and outstanding ordinary\nshares cast. Under Cayman Islands law, some matters, such as amending the memorandum and articles, changing the name or resolving to be\nregistered by way of continuation in a jurisdiction outside the Cayman Islands, require approval of shareholders by a special resolution.\n\n \n\nThere are no limitations on non-residents or\nforeign shareholders in the current memorandum and articles to hold or exercise voting rights on the ordinary shares imposed by foreign\nlaw or by the charter or other constituent document of our company. However, no person will be entitled to vote at any general meeting\nor at any separate meeting of the holders of the ordinary shares unless the person is registered as of the record date for such meeting\nand unless all calls or other sums presently payable by the person in respect of ordinary shares in the Company have been paid.\n\n \n\n*Winding Up; Liquidation.*  Upon\nthe winding up of our company, after the full amount that holders of any issued shares ranking senior to the ordinary shares as to distribution\non liquidation or winding up are entitled to receive has been paid or set aside for payment, the holders of our ordinary shares are entitled\nto receive any remaining assets of the Company available for distribution as determined by the liquidator. The assets received by the\nholders of our ordinary shares in a liquidation may consist in whole or in part of property, which is not required to be of the same kind\nfor all shareholders.\n\n \n\n*Calls on Ordinary Shares and Forfeiture of\nOrdinary Shares.*  Our board of directors may from time to time make calls upon shareholders for any amounts unpaid on their\nordinary shares in a notice served to such shareholders at least 14 days prior to the specified time and place of payment. Any ordinary\nshares that have been called upon and remain unpaid are subject to forfeiture.\n\n \n\n*Redemption of Ordinary Shares.*  We\nmay issue shares that are, or at its option or at the option of the holders are, subject to redemption on such terms and in such manner\nas it may, before the issue of the shares, determine. Under the Companies Act, shares of a Cayman Islands exempted company may be redeemed\nor repurchased out of profits or share premium of the company, provided the current memorandum and articles authorize this and it has\nthe ability to pay its debts as they come due in the ordinary course of business.\n\n \n\n98\n\n \n\n \n\n*No Preemptive Rights.*  Holders\nof ordinary shares will have no preemptive or preferential right to purchase any securities of our company.\n\n \n\n*Variation of Rights Attaching to Shares.*  If\nat any time the share capital is divided into different classes of shares, the rights attaching to any class (unless otherwise provided\nby the terms of issue of the shares of that class) may, subject to the current memorandum and articles, be varied or abrogated with the\nconsent in writing of the holders of all of the issued shares of that class or with the sanction of an ordinary resolution passed at a\ngeneral meeting of the holders of the shares of that class. \n\n \n\n*Anti-Takeover Provisions.* Some provisions\nof our current memorandum and articles of association may discourage, delay or prevent a change of control of our company or management\nthat shareholders may consider favorable, including provisions that authorize our board of directors to issue preferred shares in one\nor more series and to designate the price, rights, preferences, privileges and restrictions of such preferred shares without any further\nvote or action by our shareholders.\n\n \n\nHowever, under Cayman Islands law, our directors\nmay only exercise the rights and powers granted to them under our current memorandum and articles of association for a proper purpose\nand for what they believe in good faith to be in the best interests of our company.\n\n \n\n*Transfer of Shares. *Subject to certain\nrestriction in the articles of association as may be applicable, any shareholder may transfer all or any of its shares by an instrument\nin writing in any usual or common form or any other form which the Board of Directors may approve or on behalf of the transferor and if\nin respect of a nil or partly paid up share or if so required by the Board of Directors shall also be executed on behalf of the transferee\nand shall be accompanied by the certificate of the shares to which it relates and such other evidence as the Board of Directors may reasonably\nrequire to show the right of the transferor to make the transfer. The transferor shall be deemed to remain a holder of the share until\nthe name of the transferee is entered in the Register of Members/Shareholders in respect thereof.\n\n \n\nThe Board of Directors may in their absolute discretion\nto decline to register any transfer of any share, whether or not it is a fully paid share, without assigning any reason for so doing.\nIf the Board of Directors refuse to register a transfer, they shall within 2 months of the date on which the transfer was lodged with\nthe Company send to the transferor and transferee notice of the refusal.\n\n \n\nAll instruments of transfer which shall be registered\nshall be retained by the Company, but any instrument of transfer which the Board of Directors may decline to register shall (except in\nany case of fraud) be returned to the person depositing the same.\n\n \n\nThe registration of transfers may be suspended\nat such times and for such periods as the Board of Directors may from time to time determine, provided always that such registration shall\nnot be suspended for more than 45 days in any year.\n\n** **\n\n*Inspection of Books and Records*\n\n** **\n\nHolders of our shares have no general right under\nCayman Islands law to inspect or obtain copies of our list of shareholders or our corporate records (other than our memorandum and articles\nof association and any special resolutions passed by our shareholders, and the register of mortgages and charges of our company).\n\n \n\n*General Meeting of Shareholders.* Shareholders’\nmeetings may be convened by our board of directors. Advance notice of at least seven (7) calendar days is required for the convening\nof our annual general shareholders’ meeting and any other general meeting of our shareholders. No business shall be transacted at\nany general meeting unless a quorum of shareholders is present at the time when the meeting proceeds to business. Save as otherwise provided\nby the articles of association, a quorum shall consist of one or more shareholders present in person or by proxy holding at least one-third\n(1/3) of the paid up voting share capital of the Company.  \n\n \n\n99\n\n \n\n \n\n*Exempted Company.* We are an exempted\ncompany with limited liability under the Companies Act. The Companies Act distinguishes between ordinary resident companies and exempted\ncompanies. Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to\nbe registered as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary company except\nthat an exempted company:\n\n** **\n\n \n●\ndoes not have to file an annual return of its shareholders with the Registrar of Companies;\n\n** **\n\n \n●\nis not required to open its register of members for inspection;\n\n** **\n\n \n●\ndoes not have to hold an annual general meeting;\n\n** **\n\n \n●\nmay issue shares with no par value;\n\n** **\n\n \n●\nmay obtain an undertaking against the imposition of any future taxation (such undertakings are usually given for 20 years in the first instance);\n\n** **\n\n \n●\nmay register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;\n\n** **\n\n \n●\nmay register as a limited duration company; and\n\n** **\n\n \n●\nmay register as a segregated portfolio company.\n\n** **\n\n“Limited liability” means that the\nliability of each shareholder is limited to the amount unpaid by the shareholder on the shares of the company (except in exceptional circumstances,\nsuch as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstances in which\na court may be prepared to pierce or lift the corporate veil).\n\n \n\n**Preferred Shares**\n\n** **\n\nThe Directors may authorise the division of shares\ninto any number of Classes and the different Classes shall be authorised, established and designated (or re-designated as the case may\nbe) and the variations in the relative rights (including, without limitation, voting, dividend and redemption rights), restrictions, preferences,\nprivileges and payment obligations as between the different Classes (if any) may be fixed and determined by the Directors or by an Ordinary\nResolution. The Directors may issue shares with such preferred or other rights, all or any of which may be greater than the rights of\nOrdinary Shares, at such time and on such terms as they may think appropriate. The Directors may issue from time to time, out of the authorised\nshare capital of the Company (other than the authorised but unissued Ordinary Shares), series of preferred shares in their absolute discretion\nand without approval of the shareholders; provided, however, before any preferred shares of any such series are issued, the Directors\nshall by resolution of Directors determine, with respect to any series of preferred shares, the terms and rights of that series, including:\n\n \n\n \n(a)\nthe designation of such series, the number of preferred shares to constitute such series and the subscription price thereof if different from the par value thereof;\n\n \n\n \n(b)\nwhether the preferred shares of such series shall have voting rights, in addition to any voting rights provided by law, and, if so, the terms of such voting rights, which may be general or limited;\n\n \n\n \n(c)\nthe dividends, if any, payable on such series, whether any such dividends shall be cumulative, and, if so, from what dates, the conditions and dates upon which such dividends shall be payable, and the preference or relation which such dividends shall bear to the dividends payable on any shares of any other class or any other series of shares;\n\n \n\n \n(d)\nwhether the preferred shares of such series shall be subject to redemption by the Company, and, if so, the times, prices and other conditions of such redemption;\n\n \n\n \n(e)\nwhether the preferred shares of such series shall have any rights to receive any part of the assets available for distribution amongst the Members upon the liquidation of the Company, and, if so, the terms of such liquidation preference, and the relation which such liquidation preference shall bear to the entitlements of the holders of shares of any other class or any other series of shares;\n\n \n\n100\n\n \n\n \n\n \n(f)\nwhether the preferred shares of such series shall be subject to the operation of a retirement or sinking fund and, if so, the extent to and manner in which any such retirement or sinking fund shall be applied to the purchase or redemption of the preferred shares of such series for retirement or other corporate purposes and the terms and provisions relative to the operation thereof;\n\n \n\n \n(g)\nwhether the preferred shares of such series shall be convertible into, or exchangeable for, shares of any other class or any other series of preferred shares or any other securities and, if so, the price or prices or the rate or rates of conversion or exchange and the method, if any, of adjusting the same, and any other terms and conditions of conversion or exchange;\n\n \n\n \n(h)\nthe limitations and restrictions, if any, to be effective while any preferred shares of such series are outstanding upon the payment of dividends or the making of other distributions on, and upon the purchase, redemption or other acquisition by the Company of, the existing shares or shares of any other class of shares or any other series of preferred shares;\n\n \n\n \n(i)\nthe conditions or restrictions, if any, upon the creation of indebtedness of the Company or upon the issue of any additional shares, including additional shares of such series or of any other class of shares or any other series of preferred shares; and\n\n \n\n \n(j)\nany other powers, preferences and relative, participating, optional and other special rights, and any qualifications, limitations and restrictions thereof;\n\n \n\nand, for such purposes, the Directors may reserve\nan appropriate number of shares for the time being unissued.\n\n** **\n\nOn June 27, 2025, the shareholders of the Company\napproved that 12,000,000 preferred shares of par value US$0.00005 be designated and issued to Mr. Aimin Kong, the Chief Operating Officer\nof the Company or the company under his control, subject to the Certificate of Designation and certain vesting and earn-out terms in his\nEmployment Agreement. On June 27, 2025, the Company confirmed the vesting and earn-out terms have been met and 12,000,000 Preferred Shares\nwere issued to Hao Shun Investments Limited, a company under the control of Mr. Kong. The 12, 000,000 Preferred Shares are designated\nwith the voting powers, preferences and relative, participating, optional and other special rights, and qualifications, limitations and\nrestrictions thereof as follows:\n\n \n\nI.Voting\nRight: At any general meeting, (i) on a show of hands every holder of the Preferred Shares present in person (or being a corporation,\nis present by a duly authorized representative), or by proxy shall have fifteen (15) votes for every fully paid Preferred Share for the\ngeneral meetings of the Company and shall be included in the calculation of the quorum, and (ii) on a poll every holder of the Preferred\nShares present in person or by proxy or, in the case of a holder being a corporation, by its duly authorized representative shall have\nfifteen (15) votes for every fully paid Preferred Share for the general meetings of the Company and shall be included in the calculation\nof the quorum; and\n\n \n\nII.Conversion\nRights: Every two Preferred Share is convertible into one (1) ordinary share of the Company, par value $0.00025 (the “Ordinary\nShare”) at any time at the option of the holder thereof. The right to convert shall be exercisable by the holder of the Preferred\nShares delivering a written notice to the Company that such holder elects to convert a specified number of Preferred Shares into Ordinary\nShares. In no event shall Ordinary Shares be convertible into Preferred Shares; and\n\n \n\nIII.Transfer: the\nPreferred Shares are transferable; and\n\n \n\nIV.Other rights: all other rights of the Preferred Shares will\nbe the same as the Ordinary Shares of the Company.\n\n** **\n\n**10.C. Material Contracts**\n\n** **\n\nWe have not entered into any material contracts\nother than in the ordinary course of business and other than those described in this annual report.  \n\n** **\n\n**10.D. Exchange Controls**\n\n** **\n\n*Cayman Islands*\n\n \n\nCurrently there is no exchange control regulations\nin the Cayman Islands applicable to us and shareholders.\n\n \n\n*Hong Kong*\n\n \n\nThere are no foreign exchange controls in Hong\nKong and there is a free flow of capital into and out of Hong Kong. There are no restrictions on remittances of H.K. dollar or any other\ncurrency from Hong Kong to persons not resident in Hong Kong for the purpose of paying dividends or otherwise. \n\n \n\n*PRC*\n\n \n\nSee “*Item 4. Information on the Company—B.\nBusiness Overview—Regulation—PRC Laws and Regulations Relating to Foreign Exchange*” for exchange controls in China.\n\n**  **\n\n101\n\n \n\n** **\n\n**10.E. Taxation**\n\n** **\n\nThe following summary of the material Cayman Islands, PRC, Hong Kong\nand U.S. tax consequences for U.S. holders of an investment in our ordinary shares is based upon laws and relevant interpretations thereof\nin effect as of the date hereof, all of which are subject to change, possibly with retroactive effect. This summary is not intended to\nbe, nor should it be construed as, legal or tax advice and is not exhaustive of all possible tax considerations. This summary also does\nnot deal with all possible tax consequences relating to an investment in our ordinary shares, such as the tax consequences under state,\nlocal, or under the tax laws of jurisdictions other than the Cayman Islands, PRC, Hong Kong and the United States. **Investors should\nconsult their own tax advisors with respect to the tax consequences of the acquisition, ownership and disposition of our ordinary shares.**\n\n**  **\n\n**Cayman Islands Taxation**\n\n** **\n\nThe Cayman Islands currently levies no taxes on\nindividuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance tax\nor estate duty. There are no other taxes likely to be material to us levied by the government of the Cayman Islands except for stamp duties\nwhich may be applicable on instruments executed in, or brought within the jurisdiction of the Cayman Islands. The Cayman Islands is not\nparty to any double tax treaties that are applicable to any payments made to or by our company. There are no exchange control regulations\nor currency restrictions in the Cayman Islands. \n\n  \n\nPayments of dividends and capital in respect of\nthe shares will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of a dividend or capital\nto any holder of the shares, nor will gains derived from the disposal of the shares be subject to Cayman Islands income or corporation\ntax.\n\n \n\nNo stamp duty is payable in respect of the issue\nof the shares or on an instrument of transfer in respect of a share.\n\n \n\n**People’s Republic of China Taxation**\n\n** **\n\nUnder the EIT Law, an enterprise established outside the PRC with a\n“de facto management body” within the PRC is considered a PRC resident enterprise for PRC enterprise income tax purposes and\nis generally subject to a uniform 25% enterprise income tax rate on its worldwide income as well as tax reporting obligations. Under the\nImplementation Rules, a “de facto management body” is defined as a body that has material and overall management and control\nover the manufacturing and business operations, personnel and human resources, finances and properties of an enterprise. In addition,\nSAT Circular 82 issued in April 2009 specifies that certain offshore-incorporated enterprises controlled by PRC enterprises or PRC enterprise\ngroups will be classified as PRC resident enterprises if all of the following conditions are met: (a) senior management personnel\nand core management departments in charge of the daily operations of the enterprises have their presence mainly in the PRC; (b) their\nfinancial and human resources decisions are subject to determination or approval by persons or bodies in the PRC; (c) major assets,\naccounting books and company seals of the enterprises, and minutes and files of their board’s and shareholders’ meetings are\nlocated or kept in the PRC; and (d) half or more of the enterprises’ directors or senior management personnel with voting rights\nhabitually reside in the PRC. Further to SAT Circular 82, the SAT issued SAT Bulletin 45, which took effect in September 2011, to provide\nmore guidance on the implementation of SAT Circular 82. SAT Bulletin 45 provides for procedures and administration details of determination\non PRC resident enterprise status and administration on post-determination matters. If the PRC tax authorities determine that the Company\nis a PRC resident enterprise for PRC enterprise income tax purposes, a number of unfavorable PRC tax consequences could follow. For example,\nour operating entities in China may be subject to enterprise income tax at a rate of 25% with respect to its worldwide taxable income.\nAlso, a 10% withholding tax would be imposed on dividends we pay to our non-PRC enterprise shareholders and with respect to gains derived\nby our non-PRC enterprise shareholders from transferring our shares or ordinary shares and potentially a 20% of withholding tax would\nbe imposed on dividends we pay to our non-PRC individual shareholders and with respect to gains derived by our non-PRC individual shareholders\nfrom transferring our shares or ordinary shares.\n\n** **\n\nIt is unclear whether, if we are considered a\nPRC resident enterprise, holders of our shares or ordinary shares would be able to claim the benefit of income tax treaties or agreements\nentered into between China and other countries or areas. See “*Risk Factors—Risk Factors Relating to Doing Business in China—If\nwe are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences\nto us and our non-PRC shareholders*.”\n\n \n\n102\n\n \n\n \n\nThe SAT issued SAT Circular 59 together with the\nMinistry of Finance in April 2009 and SAT Circular 698 in December 2009. Both SAT Circular 59 and SAT Circular 698 became effective retroactively\nas of January 1, 2008, and Circular 7 replaced of some of the existing rules in Circular 698, effective in February 2015.  On\nOctober 17, 2017, the SAT promulgated Bulletin 37, and Circular 698 was replaced with effect from December 1, 2017. Under Circular 7,\nwhere a non-resident enterprise conducts an “indirect transfer” by transferring taxable assets, including, in particular,\nequity interests in a PRC resident enterprise, indirectly by disposing of the equity interests of an overseas holding company, the non-resident\nenterprise, being the transferor, or the transferee or the PRC entity which directly owned such taxable assets may report to the relevant\ntax authority such indirect transfer. Using a “substance over form” principle, the PRC tax authority may disregard the existence\nof the overseas holding company if it lacks a reasonable commercial purpose and was established for the purpose of reducing, avoiding\nor deferring PRC tax. We and non-resident enterprises in such transactions may become at risk of being subject to filing obligations or\nbeing taxed, under Circular 59 or Circular 7 and Bulletin 37, and may be required to expend valuable resources to comply with Circular\n59, Circular 7 and Bulletin 37 or to establish that we and our non-resident enterprises should not be taxed under these circulars. In\naddition, in accordance with the Individual Income Tax Law promulgated by the Standing Committee of NPC late amended on August 31, 2018\nand become effective on January 1, 2019, where an individual carries out other arrangements without reasonable business purpose and obtains\nimproper tax gains, the tax authorities shall have the right to make tax adjustment based on a reasonable method, and levy additional\ntax and collect interest if there is a need to levy additional tax after making tax adjustments. As a result, our beneficial owners, who\nare PRC residents, may be deemed to have carried out other arrangements without reasonable business purpose and obtains improper tax gains\nfor such indirect transfer, and thus be levied tax. See “*Risk Factors—Risk Factors Relating to Doing Business in China—Enhanced\nscrutiny*  *over acquisition transactions by the PRC tax authorities may have a negative impact on potential acquisitions\nwe may pursue in the future*.”\n\n  \n\nPursuant to the Arrangement between the Mainland China and the Hong\nKong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the Tax Arrangement, where a Hong\nKong resident enterprise which is considered a non-PRC tax resident enterprise directly holds at least 25% of a PRC enterprise, the withholding\ntax rate in respect of the payment of dividends by such PRC enterprise to such Hong Kong resident enterprise is reduced to 5% from a standard\nrate of 10%, subject to approval of the PRC local tax authority. Pursuant to the Notice of the State Administration of Taxation on the\nIssues concerning the Application of the Dividend Clauses of Tax Agreements, or Circular 81, a resident enterprise of the counter-party\nto such Tax Arrangement should meet the following conditions, among others, in order to enjoy the reduced withholding tax under the Tax\nArrangement: (i) it must directly own the required percentage of equity interests and voting rights in such PRC resident enterprise;\nand (ii) it should directly own such percentage in the PRC resident enterprise anytime in the 12 months prior to receiving the dividends.\nFurthermore, pursuant to the Administrative Measures for Non-Resident Taxpayers to Enjoy the Treaty Treatment, or the Administrative Measures,\nwhich became effective in January 2020, in order to enjoy the reduced withholding tax rate under the treaty treatment, non-resident taxpayers\nwho meet the conditions for treaty treatment by their own judgment, may declare that they are entitled to the treaty treatment and accept\nthe post-declaration supervision by the tax authority at the time of filing the tax return or at the time of providing information to\nthe tax withholding agent. There are also other conditions for enjoying such reduced withholding tax rate according to other relevant\ntax rules and regulations. Accordingly, Oriental Culture HK may be able to enjoy the 5% withholding tax rate for the dividends it\nreceives from the WFOE, if it satisfies the conditions prescribed under Circular 81 and other relevant tax rules and regulations,\nand obtains the approvals as required under the Administrative Measures. However, according to Circular 81, if the relevant tax authorities\nconsider the transactions or arrangements are for the primary purpose of enjoying a favorable tax treatment, the relevant tax authorities\nmay adjust the favorable withholding tax in the future. \n\n** **\n\n**Hong Kong Taxation**\n\n** **\n\nThe taxation of income and capital gains of holders\nof ordinary shares is subject to the laws and practices of Hong Kong and of jurisdictions in which holders of ordinary shares are resident\nor otherwise subject to tax. The following summary of certain relevant taxation provisions under Hong Kong law is based on current law\nand practice, is subject to changes therein and does not constitute legal or tax advice. The discussion does not deal with all possible\ntax consequences relating to an investment in the ordinary shares. Accordingly, each prospective investor (particularly those subject\nto special tax rules, such as banks, dealers, insurance companies, tax-exempt entities and holders of 10% or more of our voting capital\nstock) should consult its own tax advisor regarding the tax consequences of an investment in the ordinary shares. There is no reciprocal\ntax treaty in effect between Hong Kong and the United States.\n\n** **\n\n*Tax on Dividends*\n\n** **\n\nUnder the current practices of the Hong Kong Inland\nRevenue Department, no tax is payable in Hong Kong in respect of dividends paid by us.\n\n** **\n\n103\n\n \n\n** **\n\n*Profits Tax*\n\n** **\n\nNo tax is imposed in Hong Kong in respect of capital\ngains from the sale of property (such as the ordinary shares). Trading gains from the sale of property by persons carrying on a trade,\nprofession or business in Hong Kong where such gains are derived from or arise in Hong Kong from such trade, profession or business will\nbe chargeable to Hong Kong profits tax, which is currently imposed at the rate of 16.5% and 15% on corporations and unincorporated businesses,\nrespectively, and at a maximum rate of 15% on individuals. Liability for Hong Kong profits tax may thus arise in respect of trading gains\nfrom sales of ordinary shares realized by persons carrying on a business or trading or dealing in securities in Hong Kong.\n\n** **\n\n*Stamp Duty*\n\n** **\n\nHong Kong stamp duty, currently charged at the\nrate of HK$1 per HK$1,000 or part thereof on the higher of the consideration for or the value of the ordinary shares, will be payable\nby the purchaser on every purchase and by the seller on every sale of ordinary shares (i.e., a total of HK$2 per HK$1,000 or part thereof\nis currently payable on a typical sale and purchase transaction involving ordinary shares). In addition, a fixed duty of HK$5 is currently\npayable on any instrument of transfer of ordinary shares. If one of the parties to the sale is a non-Hong Kong resident and does not pay\nthe required stamp duty, the duty not paid will be assessed on the instrument of transfer (if any) and the transferee will be liable for\npayment of such duty. No Hong Kong stamp duty is payable upon the transfer of ordinary shares outside Hong Kong.\n\n** **\n\n*Estate Duty*\n\n** **\n\nThe Revenue (Abolition of Estate Duty) Ordinance\n2005 came into effect on February 11, 2006 in Hong Kong. No Hong Kong estate duty is payable and no estate duty clearance papers\nare needed for an application for a grant of representation in respect of holders of ordinary shares whose death occurs on or after February 11,\n2006.\n\n** **\n\n**United States Federal Income Tax Considerations\nfor U.S. holders**\n\n** **\n\nThe following is a discussion of the material United States federal\nincome tax considerations relating to the acquisition, ownership, and disposition of our ordinary shares by a U.S. Holder, as defined\nbelow, that acquires our ordinary shares and holds our ordinary shares as “capital assets” (generally, property held for investment)\nunder the United States Internal Revenue Code of 1986, as amended (the “Code”). U.S. tax consequences to non-U.S. holders\nare not discussed here. This discussion is based upon existing United States federal income tax law, which is subject to differing interpretations\nor change, possibly with retroactive effect. No ruling has been sought from the Internal Revenue Service (the “IRS”) with\nrespect to any United States federal income tax consequences described below, and there can be no assurance that the IRS or a court will\nnot take a contrary position. This discussion does not address all aspects of United States federal income taxation that may be important\nto particular investors in light of their individual circumstances, including investors subject to special tax rules (such as, for example,\ncertain financial institutions, insurance companies, regulated investment companies, real estate investment trusts, broker-dealers, traders\nin securities that elect mark-to-market treatment, partnerships and their partners, tax-exempt organizations (including private foundations)),\ninvestors who are not U.S. Holders, investors that own (directly, indirectly, or constructively) 10% or more of our voting stock, investors\nthat hold their ordinary shares as part of a straddle, hedge, conversion, constructive sale or other integrated transaction), or investors\nthat have a functional currency other than the U.S. dollar, all of whom may be subject to tax rules that differ significantly from those\nsummarized below. In addition, this discussion does not address any tax laws other than the United States federal income tax laws, including\nany state, local, alternative minimum tax or non-United States tax considerations, or the Medicare tax/net investment income tax. Each\npotential investor is urged to consult its tax advisor regarding the United States federal, state, local and non-United States income\nand other tax considerations of an investment in our ordinary shares.\n\n**  **\n\n*General*\n\n** **\n\nFor purposes of this discussion, a “U.S.\nHolder” is a beneficial owner of our ordinary shares that is, for United States federal income tax purposes, (i) an individual who\nis a citizen or treated as a tax resident of the United States, (ii) a corporation (or other entity treated as a corporation for United\nStates federal income tax purposes) created in, or organized under the laws of, the United States or any state thereof or the District\nof Columbia, (iii) an estate the income of which is includible in gross income for United States federal income tax purposes regardless\nof its source, or (iv) a trust (A) the administration of which is subject to the primary supervision of a United States court and which\nhas one or more United States persons who have the authority to control all substantial decisions of the trust or (B) that has otherwise\nelected to be treated as a United States person under the Code.\n\n \n\n104\n\n \n\n \n\nIf a partnership (or other entity treated as a\npartnership for United States federal income tax purposes) is a beneficial owner of our ordinary shares, the tax treatment of a partner\nin the partnership will depend upon the status of the partner and the activities of the partnership. Partnerships and partners of a partnership\nholding our ordinary shares are urged to consult their tax advisors regarding an investment in our ordinary shares.\n\n   \n\nThe discussion set forth below is addressed only\nto U.S. Holders that purchase ordinary shares. Prospective purchasers are urged to consult their own tax advisors about the application\nof the U.S. federal income tax rules to their particular circumstances as well as the state, local, foreign and other tax consequences\nto them of the purchase, ownership and disposition of our ordinary shares.\n\n \n\n*Taxation of Dividends and Other Distributions\non our Ordinary Shares*\n\n* *\n\nSubject to the passive foreign investment\ncompany rules discussed below, the gross amount of distributions made by us to you with respect to the ordinary shares (including\nthe amount of any taxes withheld therefrom) will generally be includable in your gross income as dividend income on the date of\nreceipt by you, but only to the extent that the distribution is paid out of our current or accumulated earnings and profits (as\ndetermined under U.S. federal income tax principles). With respect to corporate U.S. Holders, the dividends will not be eligible for\nthe dividends-received deduction allowed to corporations in respect of dividends received from other U.S. corporations.\n\n \n\nWith respect to non-corporate U.S. Holders, including individual U.S.\nHolders, dividends will be taxed at the lower capital gains rate applicable to qualified dividend income, provided that (1) the ordinary\nshares are readily tradable on an established securities market in the United States, or we are eligible for the benefits of a qualifying\nincome tax treaty with the United States that includes an exchange of information program, (2) we are not a passive foreign investment\ncompany (as discussed below) for either our taxable year in which the dividend is paid or the preceding taxable year, and (3) certain\nholding period requirements are met. Because there is no income tax treaty between the United States and the Cayman Islands, clause (1)\nabove can be satisfied only if the ordinary shares are readily tradable on an established securities market in the United States. Under\napplicable U.S. Internal Revenue Service authority, ordinary shares are considered readily tradeable for purposes of clause (1) above\nif they are listed on an established securities market in the United States, which presently include the Nasdaq. You are urged to consult\nyour tax advisors regarding the availability of the lower rate for dividends paid with respect to our ordinary shares, including the effects\nof any change in law, regulation or interpretation after the date of this report.\n\n \n\nTo the extent that the amount of the distribution exceeds our current\nand accumulated earnings and profits (as determined under U.S. federal income tax principles), such excess generally will be treated first\nas a tax-free return of your tax basis in your ordinary shares, and to the extent the amount of the distribution exceeds your tax basis,\nthe excess will be taxed as capital gain. We do not intend to calculate our current or accumulated earnings and profits under U.S. federal\nincome tax principles. Therefore, a U.S. Holder should expect that a distribution will be treated as a dividend even if that distribution\nwould otherwise be treated as a non-taxable return of capital or as capital gain under the rules described above.\n\n \n\n*Taxation of Dispositions of Ordinary Shares*\n\n* *\n\nSubject to the passive foreign investment company\nrules discussed below, you will recognize taxable gain or loss on any sale, exchange or other taxable disposition of a share equal to\nthe difference between the amount realized (in U.S. dollars) for the share and your tax basis (in U.S. dollars) in the ordinary shares.\nThe gain or loss will be capital gain or loss. If you are a non-corporate U.S. Holder, including an individual U.S. Holder, who has held\nthe ordinary shares for more than one year, you may be eligible for reduced tax rates on any such capital gains. The deductibility of\ncapital losses is subject to limitations.\n\n \n\n*Passive Foreign Investment Company (“PFIC”)*\n\n* *\n\nA non-U.S. corporation is considered a PFIC for\nany taxable year if either:\n\n \n\n \n●\nat least 75% of its gross income for such taxable year is passive income; or\n\n \n\n \n●\nat least 50% of the value of its assets (based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income (the “asset test”).\n\n**  **\n\nPassive income generally includes dividends,\ninterest, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the\ndisposition of passive assets. We will be treated as owning our proportionate share of the assets and earning our proportionate share\nof the income of any other corporation in which we own, directly or indirectly, at least 25% (by value) of the stock. In determining\nthe value and composition of our assets for purposes of the PFIC asset test, (1) the cash we hold will generally be considered to be\nheld for the production of passive income and (2) the value of our assets must be determined based on the market value of our ordinary\nshares from time to time, which could cause the value of our non-passive assets to be less than 50% of the value of all of our assets\n(including the cash raised in any offering) on any particular quarterly testing date for purposes of the asset test.\n\n \n\n105\n\n \n\n \n\nWe must make a separate determination each year as to whether we are\na PFIC. Depending on the amount of cash we hold, together with any other assets held for the production of passive income, it is possible\nthat, for our current taxable year or for any subsequent taxable year, at least 50% of our assets may be assets held for the production\nof passive income. We will make this determination following the end of any particular tax year, and no assurance can be given regarding\nour PFIC status for any taxable year. Although the law in this regard is unclear, we treated the consolidated variable interest entity,\nas being owned by us for United States federal income tax purposes, not only because we exercise effective control over the operation\nof such entities but also because we are entitled to substantially all of their economic benefits, and, as a result, we consolidate their\noperating results in our consolidated financial statements. In particular, because the value of our assets for purposes of the asset test\nwill generally be determined based on the market price of our ordinary shares and because cash is generally considered to be an asset\nheld for the production of passive income, our PFIC status will depend in large part on the market price of our ordinary shares and the\namount of cash we hold. Accordingly, fluctuations in the market price of the ordinary shares may cause us to become a PFIC. In addition,\nthe application of the PFIC rules is subject to uncertainty in several respects. We are under no obligation to take steps to reduce the\nrisk of our being classified as a PFIC, and as stated above, the determination of the value of our assets will depend upon material facts\n(including the market price of our ordinary shares from time to time that may not be within our control). If we are a PFIC for any year\nduring which you hold ordinary shares, the shares will continue to be treated as stock in a PFIC for all succeeding years during which\nyou hold ordinary shares. However, if we cease to be a PFIC and you did not previously make a timely “mark-to-market” election\nas described below, you may avoid some of the adverse effects of the PFIC regime by making a “purging election” (as described\nbelow) with respect to the ordinary shares. Prospective investors should assume that PFIC status is uncertain and consult their own tax\nadvisors regarding the PFIC rules and the consequences to them if we are or become a PFIC.\n\n** **\n\nIf we are a PFIC for your taxable year(s) during\nwhich you hold ordinary shares, you will be subject to special tax rules with respect to any “excess distribution” that you\nreceive and any gain you realize from a sale or other disposition (including a pledge) of the ordinary shares, unless you make a “mark-to-market”\nelection as discussed below. Distributions you receive in a taxable year that are greater than 125% of the average annual distributions\nyou received during the shorter of the three preceding taxable years or your holding period for the ordinary shares will be treated as\nan excess distribution. Under these special tax rules:\n\n** **\n\n \n●\nthe excess distribution or gain will be allocated ratably over your holding period for the ordinary shares;\n\n** **\n\n \n●\nthe amount allocated to your current taxable year, and any amount allocated to any of your taxable year(s) prior to the first taxable year in which we were a PFIC, will be treated as ordinary income, and\n\n \n\n \n●\nthe amount allocated to each of your other taxable year(s) will be subject to the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.\n\n** **\n\nThe tax liability for amounts allocated to years\nprior to the year of disposition or “excess distribution” cannot be offset by any net operating losses for such years, and\ngains (but not losses) realized on the sale of the ordinary shares cannot be treated as capital, even if you hold the ordinary shares\nas capital assets.\n\n  \n\nA U.S. Holder of “marketable stock”\n(as defined below) in a PFIC may make a mark-to-market election for such stock to elect out of the tax treatment discussed above. If you\nmake a mark-to-market election for first taxable year which you hold (or are deemed to hold) ordinary shares and for which we are determined\nto be a PFIC, you will include in your income each year an amount equal to the excess, if any, of the fair market value of the ordinary\nshares as of the close of such taxable year over your adjusted basis in such ordinary shares, which excess will be treated as ordinary\nincome and not capital gain. You are allowed an ordinary loss for the excess, if any, of the adjusted basis of the ordinary shares over\ntheir fair market value as of the close of the taxable year. However, such ordinary loss is allowable only to the extent of any net mark-to-market\ngains on the ordinary shares included in your income for prior taxable years. Amounts included in your income under a mark-to-market election,\nas well as gain on the actual sale or other disposition of the ordinary shares, are treated as ordinary income. Ordinary loss treatment\nalso applies to any loss realized on the actual sale or disposition of the ordinary shares, to the extent that the amount of such loss\ndoes not exceed the net mark-to-market gains previously included for such ordinary shares. Your basis in the ordinary shares will be adjusted\nto reflect any such income or loss amounts. If you make a valid mark-to-market election, the tax rules that apply to distributions by\ncorporations which are not PFICs would apply to distributions by us, except that the lower applicable capital gains rate for qualified\ndividend income discussed above under “— *Taxation of Dividends and Other Distributions on our ordinary shares*”\ngenerally would not apply.\n\n \n\n106\n\n \n\n \n\nThe mark-to-market election is available only\nfor “marketable stock”, which is stock that is traded in other than de minimis quantities on at least 15 days during each\ncalendar quarter (“regularly traded”) on a qualified exchange or other market (as defined in applicable U.S. Treasury regulations),\nincluding Nasdaq. If the ordinary shares are regularly traded on Nasdaq and if you are a holder of ordinary shares, the mark-to-market\nelection would be available to you were we to be or become a PFIC.\n\n \n\nAlternatively, a U.S. Holder of stock in a PFIC\nmay make a “qualified electing fund” election with respect to such PFIC to elect out of the tax treatment discussed above.\nA U.S. Holder who makes a valid qualified electing fund election with respect to a PFIC will generally include in gross income for a taxable\nyear such holder’s pro rata share of the corporation’s earnings and profits for the taxable year. However, the qualified electing\nfund election is available only if such PFIC provides such U.S. Holder with certain information regarding its earnings and profits as\nrequired under applicable U.S. Treasury regulations. We do not currently intend to prepare or provide the information that would enable\nyou to make a qualified electing fund election.\n\n \n\nIf you hold ordinary shares in any taxable year\nin which we are a PFIC, you will be required to file U.S. Internal Revenue Service Form 8621 in each such year and provide certain annual\ninformation regarding such ordinary shares, including regarding distributions received on the ordinary shares and any gain realized on\nthe disposition of the ordinary shares.\n\n \n\nIf you do not make a timely “mark-to-market”\nelection (as described above), and if we were a PFIC at any time during the period you hold our ordinary shares, then such ordinary shares\nwill continue to be treated as stock of a PFIC with respect to you even if we cease to be a PFIC in a future year, unless you make a “purging\nelection” for the year we cease to be a PFIC. A “purging election” creates a deemed sale of such ordinary shares at\ntheir fair market value on the last day of the last year in which we are treated as a PFIC. The gain recognized by the purging election\nwill be subject to the special tax and interest charge rules treating the gain as an excess distribution, as described above. As a result\nof the purging election, you will have a new basis (equal to the fair market value of the ordinary shares on the last day of the last\nyear in which we are treated as a PFIC) and holding period (which new holding period will begin the day after such last day) in your ordinary\nshares for tax purposes.\n\n \n\nYou are urged to consult your tax advisors regarding\nthe application of the PFIC rules to your investment in our ordinary shares and the elections discussed above.\n\n** **\n\n*Information Reporting and Backup Withholding*\n\n \n\nPayments of dividends and sales proceeds that\nare made within the United States or through certain U.S.-related intermediaries may be subject to information reporting and backup withholding,\nunless (i) the U.S. Holder is a corporation or other “exempt recipient” or (ii) in the case of backup withholding, the U.S.\nHolder provides a correct taxpayer identification number and certifies that it is not subject to backup withholding. Backup withholding\nis not an additional tax. The amount of any backup withholding from a payment to a U.S. Holder will be allowed as a credit against the\nU.S. Holder’s U.S. federal income tax liability and may entitle it to a refund, provided that the required information is timely\nfurnished to the IRS.\n\n \n\n*Information with respect to foreign financial\nassets*\n\n \n\nCertain U.S. Holders who are individuals (and,\nunder proposed regulations, certain entities) may be required to report information relating to an interest in our ordinary shares, subject\nto certain exceptions (including an exception for ordinary shares held in accounts maintained by certain U.S. financial institutions).\nU.S. Holders should consult their tax advisors regarding the effect, if any, of this legislation on their ownership and disposition of\nour ordinary shares.\n\n \n\n107\n\n \n\n** **\n\n**10.F. Dividends and Paying Agents**\n\n** **\n\nNot Applicable.\n\n** **\n\n**10.G. Statement by Experts**\n\n** **\n\nNot Applicable.\n\n** **\n\n**10.H. Documents on Display**\n\n** **\n\nWe are subject to periodic reporting and other informational requirements\nof the Exchange Act as applicable to foreign private issuers. Accordingly, we are required to file reports, including annual reports on\nForm 20-F, and other information with the SEC. All information filed with the SEC can be obtained over the internet at the SEC’s\nwebsite at www.sec.gov or inspected and copied at the public reference facilities maintained by the SEC at 100 F Street, N.E., Washington,\nD.C. 20549. The public may obtain information regarding the Washington, D.C. Public Reference Room by calling the SEC at 1-800-SEC-0330.\nThe SEC also maintains a web site at www.sec.gov that contains reports and other information regarding registrants that make electronic\nfilings with the SEC using its EDGAR system. As a foreign private issuer, we are exempt from the rules under the Exchange Act prescribing\nthe furnishing and content of quarterly reports and proxy statements, and officers, directors and principal shareholders are exempt from\nthe short-swing profit recovery provisions and principal shareholders are exempted from the reporting provisions contained in Section 16\nof the Exchange Act. You may also visit us on the world wide web at http://www.ocgroup.hk. However, information contained on our website\ndoes not constitute a part of this annual report.\n\n** **\n\n**10.I. Subsidiary Information**\n\n** **\n\nNot Applicable.\n\n** **\n\n**10.J. Annual Report to Security Holders**\n\n \n\nNot applicable."}