{"url_path":"/sec/sos/10-k/2026/item-4","section_key":"item-4","section_title":"Item 4 INFORMATION ON THE COMPANY**","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-05-15","source_url":"https://www.sec.gov/Archives/edgar/data/1346610/0001213900-26-057725-index.html","accession_number":"0001213900-26-057725","cik":"0001346610","ticker":"SOS","issuer_name":"SOS Ltd","edgar_url":"https://www.sec.gov/Archives/edgar/data/1346610/0001213900-26-057725-index.html","primary_entity_key":"0001346610","primary_entity_name":"SOS Ltd"},"word_count":5761,"has_tables":true,"body_markdown":"**ITEM\n4. INFORMATION ON THE COMPANY**\n\n \n\n**A.\nHistory and Development of the Company**\n\n \n\nWe\nwere formed in Delaware on July 12, 2004 as China Risk Finance LLC. We began our credit analytics service provider business in 2001.\nWe developed our proprietary, advanced technology over the past 18 years, during which our founders and management team advised many\nof China’s largest banks in analyzing consumer credit to issue over one hundred million credit cards to consumers. On April 28,\n2017, our ADSs commenced trading on the NYSE under the symbol “XRF.” In May 2017, we completed our IPO in which we sold a\ntotal of 11,500,000 of our ADSs, each representing ten Class A Ordinary Shares and listing of our ADSs on the NYSE. In the third quarter 2018, due to regulatory changes\nthat made it cost-prohibitive, and in some ways very risky from the regulatory compliance perspective, to own and operate our legacy\nmarketplace lending platform, we decided to cease the customer acquisition and loan facilitation at our legacy marketplace lending platform\nand started to transition our business to other industries.\n\n \n\nOn\nMay 5, 2020, we entered into a set of agreements with YBT (Yongbao Two Ltd.), the shareholders of YBT (the “YBT Shareholders”),\neight individual investors introduced by YBT (collectively with the YBT Shareholders, the “Investors”) and True North Financial,\nLLC to acquire YBT, which controls its variable interest entity SOS Information. The transaction was consummated on May 15, 2020. As\na result, we now own 100% of YBT, which controls its variable interest entity, SOS Information Technology Co., Ltd (“SOS Information”).\nThe shares issued to the Investors were relied on exemption from registration in accordance with Regulation S and/or Rule 4(a)(2) under\nthe Securities Act of 1933, as amended. Accordingly, we started our newly acquired data mining and targeted marketing services business\nthrough SOS Information.\n\n \n\nOn\nAugust 3, 2020, we entered into a certain share purchase agreement (the “Disposition SPA”) with Hantu (Hangzhou) Asset Management\nCo., Ltd. (the “Purchaser”). Pursuant to the Disposition SPA, the Purchaser agreed to purchase CRF China Holding Co. Limited,\na Hong Kong limited company, China Capital Financial LLC, a Delaware limited liability company, CRF China Limited, a British Virgin Islands\ncompany, CRF Technology LLC, a California limited liability company, and HML China LLC, a Delaware limited liability company (collectively,\nthe “XRF Subsidiaries”) in exchange for cash consideration of $3.5 million. Upon the closing of the transaction (the “Disposition”)\ncontemplated by the Disposition SPA, the Purchaser will become the sole shareholder of the XRF Subsidiaries and as a result, assume all\nassets and liabilities of all the subsidiaries and variable interest entities owned or controlled by the XRF Subsidiaries. The Disposition\nclosed on August 6, 2020. As a result of the Disposition, we ceased our legacy peer-to-peer lending business and have since focused on\nbecoming a leading high-technology services business with services including marketing data, technology and solutions for insurance companies\nand emergency rescue services in China. We also changed our trading symbol to “SOS.”\n\n \n\nOn\nMay 14, 2020, Qingdao SOS Investment Management Co., Ltd. (“Qingdao SOS Investment”), Qingdao SOS Industrial Holding Co.,\nLtd. (“Qingdao SOS Industrial”), and Messrs. Yilin Wang, Weidong Feng, and Xianlong Wu, citizens of China and shareholders\nof Qingdao SOS Industrial, entered into a series of contractual arrangements, including Technical Consulting and Service Agreement, Equity\nInterest Purchase Option Agreement, Equity Pledge Agreement and Voting Rights Proxy and Financial Support Agreement, collectively, the\n“Qingdao SOS Investment VIE Agreements,” pursuant to which Qingdao SOS Investment has contractual rights to exercise control\nover the Qingdao SOS Industrial.\n\n \n\nOn\nNovember 2, 2022, pursuant to the terms of the Qingdao SOS Investment VIE Agreements, Qingdao SOS Investment, Qingdao SOS Industrial,\nand shareholders of Qingdao SOS Industrial unanimously agreed to terminate the Qingdao SOS Investment VIE Agreements. The termination\nof the VIE contractual arrangements were effective on November 2, 2022.\n\n \n\nOn\nNovember 2, 2022, Qingdao S Investment Holding Limited (“Qingdao S Investment”), Qingdao SOS Industrial Holding Co., Ltd.\n(“Qingdao SOS Industrial”), and Messrs. Yilin Wang, Weidong Feng, and Xianlong Wu, citizens of China and shareholders of\nQingdao SOS Industrial, entered into a series of contractual arrangements, including Equity Pledge Agreement, Exclusive Management Consultation\nand Business Cooperation Agreement, Exclusive Purchase Option Agreement and Power of Attorney, collectively, the “Qingdao S Investment\nVIE Agreements,” pursuant to which Qingdao S Investment has contractual rights to exercise control over the Qingdao S Industrial.\n\n \n\nTherefore,\nQingdao SOS Industrial and its subsidiaries’ financial results had been consolidated by the Company in accordance with U.S. GAAP\ndue to the Company being the primary beneficiary of these companies prior to the Disposition (as defined below) in November 2022.\n\n \n\n36\n\n \n\n \n\nOn\nNovember 2, 2022, the Company entered into a certain share purchase agreement (the “Disposition SPA”) with S International\nHoldings Limited (the “Purchaser”), a Cayman Islands exempt company, and S International Group Limited (“S International”\nor the “Target”), a British Virgin Islands company and the Company’s wholly owned subsidiary prior to the Disposition.\nPursuant to the Disposition SPA, the Purchaser agreed to purchase S International in exchange for cash consideration of $17,000,000.\nUpon the closing of the transaction (the “Disposition”) contemplated by the Disposition SPA on November 2, 2022 (the\n“Closing Date”) , the Purchaser became the sole shareholder of S International and as a result, assume all assets and\nliabilities of all the subsidiaries and VIE entities owned or controlled by S International. S International owns 100% of the issued\nshares in S International Holdings Limited, which owns 100% of the issued shares in Qingdao S Investment. Qingdao S Investment controls\nQingdao SOS Industrial, the former VIE, through a series of contractual agreements with the former VIE and the shareholders of the former\nVIE dated November 2, 2022. The former VIE owns 100% of the equity interests in each of SOS Information Technology Co., Ltd. and Qingdao\nSOS Digital Technologies Inc.\n\n \n\nAs\nthe VIE structure has been unwound, the financial results of the former VIE and its subsidiaries are no longer consolidated into the\nCompany’s financial statements after the Closing Date. As of the date of this annual report, our current corporate structure does\nnot contain any VIE in mainland China and neither we nor our subsidiaries has intention establishing any VIEs in mainland China in the\nfuture.\n\n \n\nThe\nfollowing diagram illustrates our corporate structure as of the date of this annual report:\n\n \n\n \n\nOur\nability to pay dividends depends upon dividends paid by our subsidiaries in mainland China. If our subsidiaries in mainland China incur\ndebt on their own behalf, the instruments governing their debt may restrict their ability to pay dividends to us. The subsidiaries in\nmainland China will be permitted to pay dividends to us only out of its retained earnings, if any, as determined in accordance with the\nAccounting Standards for Business Enterprise as promulgated by the Ministry of Finance of the PRC, or PRC GAAP.\n\n \n\nPursuant\nto the law applicable to China’s foreign investment enterprises, a company that is a foreign investment enterprise in the PRC has\nto make appropriation from its after-tax profit, as determined under PRC GAAP, to reserve funds including (i) general reserve fund, however,\nit is a common accounting practice in China not to provide statutory reserves until any dividend distribution is declared, especially\nwhen no registered paid-up capital has been established and recognized yet; (ii) enterprise expansion fund and (iii) staff bonus and\nwelfare fund. The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with\nPRC GAAP. Appropriation is not required if the reserve fund has reached 50% of the total capital contribution to be paid-in by shareholders\n(the “Registered Capital”) of the operating company. Although (ii) and (iii) as set forth above are required, it is determined\nat the discretion of its board of directors (the “Board”). As of the date of this letter, the Board has not yet passed such\nresolutions. General reserve fund and statutory surplus fund are restricted for set off against losses, expansion of production and operation\nor increase in Registered Capital of the respective companies. These reserves are not transferable to the Company in the form of cash\ndividends, loans or advances. These reserves are therefore not available for distribution except in liquidation.\n\n \n\n37\n\n \n\n \n\nAs\nof December 31, 2025 and 2024, the Company’s subsidiaries in mainland China has not accrued any money in the reserve fund.\n\n \n\nAs\na Cayman Islands holding company, we will be permitted under PRC laws and regulations to provide funding from the proceeds of our offshore\nfund-raising activities to the operating entities (as a subsidiary) in China only through loans or capital contributions, and to\nthe consolidated affiliated entity only through loans, in each case subject to the satisfaction of the applicable government registration\nand approval requirements. Before providing loans to the onshore entities (i.e. the PRC subsidiaries), we will be required to make filings\nabout details of the loans with SAFE in accordance with relevant PRC laws and regulations. The PRC subsidiaries that receive the loans\nare only allowed to use the loans for the purposes set forth in these laws and regulations.\n\n \n\nAs\nof the date of this annual report, there have not been any dividends or distributions made to the holding company, nor have there been\nany dividends or distributions made to U.S. investors. We are subject to restrictions on foreign exchange and our ability to transfer\ncash between entities, across borders, and to U.S. investors. We are also subject to restrictions and limitations on our ability to distribute\nearnings from our businesses, including subsidiaries and/or consolidated VIEs if any, to our holding company and U.S. investors as well\nas the ability to settle amounts owed under the VIE agreements. Neither we nor any of our subsidiaries has obtained the approval from\neither the China Securities Regulatory Commission (the “CSRC”) or the Cyberspace Administration of China (the “CAC”)\nfor any offering of our Class A Ordinary Shares in the United States, and we do not intend to obtain the approval from either the CSRC\nor the CAC in connection with any such offering, since we do not believe, based upon advice of our PRC counsel, Hebei Changjun Law Firm,\nthat such approval is required for the time being.   We cannot assure you, however, that regulators in China will not take\na contrary view or will not subsequently require us to undergo the approval procedures and subject us to penalties for non-compliance.\nSee “Risk Factors — Risks Related to Doing Business in China — The approval of the CSRC, may be required in connection\nwith the listing and trading of our securities under PRC rules, regulations, or policies, and, if required, we cannot predict whether\nor how soon we will be able to obtain such approval. As a result, both you and us fact uncertainty about future actions by the PRC government\nthat could significantly affect our business, our listing on NYSE, financial condition and results of operations.”\n\n \n\nThe\nfollowing financial information has been prepared to illustrate the consolidated cash flows for the years ended December 31,\n2025 for (i) SOS Limited; (ii) China SOS Limited.; (iii) Qingdao SOS Investment, one of our WFOEs; (v) Subsidiaries outside\nChina (vi) Subsidiaries inside China. The financial information of SOS Limited has been extracted from: SOS Limited’s audited consolidated\nstatements of cash flows for the year ended December 31, 2025 and the related notes, included elsewhere in this annual report.\n\n \n\nSOS Limited\n(“SOS”) refers to the ultimate parent or the registrant, a Cayman Islands exempt company.\n\n \n\nChina SOS\nLimited (“China SOS”) is a Hong Kong corporation.\n\n \n\nQingdao SOS\nInvestment Management Co., Ltd. (“Qingdao SOS Investment”), a PRC corporation., one of the Company’s WFOEs.\n\n \n\nQingdao SOS\nIndustrial Holding Co., Ltd., the former VIE, a PRC corporation.\n\n \n\nSubsidiaries\noutside China include Yong Bao Two Ltd. (“YBT,” a British Virgin Islands company), FDW Limited (“FDW,” a British\nVirgin Islands company), SOS Information Technology New York Inc.(“SOSNY,” a New York corporation), FD LLC (“FD,”\na Nevada corporation), Future Technology Global Limited (“FTHK,” a Hong Kong corporation), Canada XX Exchange Ltd.(“CXXE,”\na Canada corporation) and US XX Exchange Ltd. (“USXXE,” a Colorado corporation).\n\n \n\nWe terminated our ADS in September 2025 and directly listed our Class\nA Ordinary Shares on the NYSE. \n\n \n\n38\n\n \n\n \n\nCondensed\nconsolidated statement of cash flow\n\n(US$ thousands,\nexcept share data and per share data, or otherwise noted)\n\n \n\n \n \n**31-Dec-25**\n \n\n \n \n**SOS\nLtd.**\n \n \n**China\nSOS Ltd.**\n \n \n**WFOE**\n \n \n**Subsidiaries\nOutside\nChina**\n \n \n**Subsidiaries\ninside\nChina**\n \n \n**Consolidation\nAdjustments(a)**\n \n \n**Consolidation\nAdjustments(b)**\n \n \n**SOS\nLtd.\nConsolidated total**\n \n\n \n \n**US$**\n \n \n**US$**\n \n \n**US$**\n \n \n**US$**\n \n \n**US$**\n \n \n**US$**\n \n \n**US$**\n \n \n**US$**\n \n\nCASH FLOWS\nFROM OPERATING ACTIVITIES\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNet\n(loss)\n \n \n(16,411\n)\n \n \n(2,045\n) \n \n \n(69\n)\n \n \n(23,438\n)\n \n \n(55,356\n)\n \n \n-\n \n \n \n \n \n \n \n(97,319\n)\n\nNet\n(loss) from discontinued operation\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNet loss\nfrom continuing operation\n \n \n(16,411\n)\n \n \n(2,045\n) \n \n \n(69\n)\n \n \n(23,438\n)\n \n \n(55,356\n)\n \n \n-\n \n \n \n \n \n \n \n(97,319\n)\n\nAdjustments\nto reconcile net income net cash used in operating activities:\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n\nDepreciation\nof property, plant and equipment\n \n \n \n \n \n \n-\n \n \n \n \n \n \n \n-\n \n \n \n8,706\n \n \n \n \n \n \n \n \n \n \n \n8,706\n \n\nDepreciation\nof ROU\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n2\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n2\n \n\nShare-based\ncompensation\n \n \n7,170\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n7,170\n \n\nAllowance\nfor doubtful accounts - accounts receivable\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n144\n \n \n \n1,410\n \n \n \n \n \n \n \n \n \n \n \n1,554\n \n\nAllowance\nfor doubtful accounts - other receivable\n \n \n5,675\n \n \n \n1,058\n \n \n \n \n \n \n \n(258\n)\n \n \n44,703\n \n \n \n \n \n \n \n \n \n \n \n44,703\n \n\nImpairment\nof cryptocurrencies\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n6,723\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n6,723\n \n\nImpairment\nof Mining Equipment\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n5,861\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n5,861\n \n\nImpairment\nof Fixed Assets\n \n \n \n \n \n \n1,025\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n1,025\n \n\nInventory\nmark down\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n5,579\n \n \n \n \n \n \n \n \n \n \n \n5,579\n \n\nInventory\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(144\n)\n \n \n3,594\n \n \n \n \n \n \n \n \n \n \n \n3,450\n \n\nAccounts\nreceivable\n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(2,082\n)\n \n \n \n \n \n \n \n \n \n \n(2,082\n)\n\nTrading\nFinancial Assets\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n7,371\n \n \n \n \n \n \n \n \n \n \n \n7,371\n \n\nOther receivables\n \n \n(229,927\n)\n \n \n(410\n)\n \n \n \n \n \n \n(2,742\n)\n \n \n15,527\n \n \n \n6,262\n \n \n \n \n \n \n \n(211,290\n)\n\nInter-company\naccount\n \n \n(46,516\n)\n \n \n178,585\n \n \n \n291,181\n \n \n \n(126,034\n)\n \n \n(332,936\n)\n \n \n35,720\n \n \n \n \n \n \n \n-\n \n\nAmount\ndue from related parties\n \n \n30,582\n \n \n \n-\n \n \n \n \n \n \n \n-\n \n \n \n108\n \n \n \n(60,327\n)\n \n \n \n \n \n \n(29,637\n)\n\nIntangible\nassets\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n\nAccrued\nliabilities\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(4,674\n)\n \n \n \n \n \n \n \n \n \n \n(4,674\n)\n\nTax payables\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(35\n)\n \n \n \n \n \n \n \n \n \n \n(35\n)\n\nAccounts\npayable\n \n \n \n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n6,836\n \n \n \n \n \n \n \n \n \n \n \n6,836\n \n\nOther payables\n \n \n(232\n) \n \n \n50\n \n \n \n(43\n)\n \n \n(4,465\n)\n \n \n1,138\n \n \n \n(4,352\n)\n \n \n \n \n \n \n(7,904\n)\n\nAmount\ndue to related parties\n \n \n1,000\n \n \n \n \n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n1,000\n \n\nContract\nliabilities\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n-\n \n\nLease liability\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n2\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n2\n \n\nNet Cash\nused in Operating Activities - Continuing Operations\n \n \n(248,659\n)\n \n \n178,263\n \n \n \n291,069\n \n \n \n(144,349\n)\n \n \n(300,111\n)\n \n \n(22,697\n)\n \n \n-\n \n \n \n(246,484\n)\n\nNet Cash\ngenerated from Operating Activities - Discontinued Operations\n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n\nNet cash\ngenerated from/(used in) operating activities\n \n \n(248,659\n)\n \n \n178,263\n \n \n \n291,069\n \n \n \n(144,349\n)\n \n \n(300,111\n)\n \n \n(22,697\n)\n \n \n-\n \n \n \n(246,484\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH FLOWS\nFROM INVESTING ACTIVITIES:\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nPurchase\nof property, equipment and equipment\n \n \n \n \n \n \n-\n \n \n \n \n \n \n \n(38\n)\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(38\n)\n\nInvestment\nin equity\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n\nProceed\nfrom disposals of discontiuned operations\n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNet cash\n(used in) generated from investing activities\n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(38\n)\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(38\n)\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nCASH FLOWS\nFROM FINANCING ACTIVITIES\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nProceed\nfrom share issuance, net of issuance costs\n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n\nProceed\nfrom private equity placement, net of issuance costs\n \n \n \n \n \n \n-\n \n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n\nRepayment\nof principle portion of  lease liabilities\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n2\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n2\n \n\nProceeds\nfrom share issuance, net of issuance costs\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n15,788\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n15,788\n \n\nProceeds\nfrom disposal of subsidiaries\n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n\nNet cash\ngenerated from (used in) financing activities\n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n15,790\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n15,790\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n-\n \n\nEFFECT\nOF EXCHANGE RATES ON CASH\n \n \n-\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n5,833\n \n \n \n \n \n \n \n         \n \n \n \n5,833\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nNet increase/(decrease),\neffect of exchange rate changes on cash and cash equivalent\n \n \n(248,659\n)\n \n \n178,263\n \n \n \n291,069\n \n \n \n(128,597\n)\n \n \n(294,278\n)\n \n \n(22,697\n)\n \n \n-\n \n \n \n(224,899\n)\n\nCASH AND\nCASH EQUIVALENTTS, beginning of year\n \n \n19,885\n \n \n \n157,252\n \n \n \n825\n \n \n \n47,593\n \n \n \n2,576\n \n \n \n \n \n \n \n \n \n \n \n228,131\n \n\nCASH AND\nCASH EQUIVALENTTS, end of year\n \n \n128\n \n \n \n42\n \n \n \n135\n \n \n \n1,606\n \n \n \n1,321\n \n \n \n \n \n \n \n-\n \n \n \n3,232\n \n\n \n\n39\n\n \n\n \n\n**Rollforward\nof “Investment in Subsidiaries of the former VIE”**\n\n** **\n\n \n \n**US$“000”**\n \n\n**Balance at January 1, 2019**\n \n \n(128\n)\n\nEquity earnings of WOFE\n \n \n \n \n\nEquity in earnings of VIE\n \n \n1,470\n \n\nEquity in earnings of VIE’s subsidiaries\n \n \n-\n \n\nDividend distributed to shareholders\n \n \n-\n \n\nShare-based compensation\n \n \n-\n \n\nForeign currency translation\n \n \n(16\n)\n\n**Balance at December 31, 2019**\n \n \n1,326\n \n\nEquity earnings of WOFE\n \n \n(3\n)\n\nEquity in earnings of VIE\n \n \n12,425\n \n\nEquity in earnings of VIE’s subsidiaries\n \n \n(8,121\n)\n\nDividend distributed to shareholders\n \n \n-\n \n\nAcquisition of China Rapid Finance\n \n \n10,661\n \n\nIssuance of Class A Ordinary Shares and warrant\n \n \n42,022\n \n\nShare-based compensation\n \n \n951\n \n\nForeign currency translation\n \n \n874\n \n\n**Balance at December 31, 2020**\n \n \n60,135\n \n\nIssuance of Class A Ordinary Shares and warrant\n \n \n585,849\n \n\nEquity in earnings of WOFE\n \n \n(12\n)\n\nEquity in earnings of VIE\n \n \n1,157\n \n\nEquity in earnings of VIE’s subsidiaries\n \n \n(165,860\n)\n\nDividend distributed to shareholders\n \n \n-\n \n\nShare-based compensation\n \n \n33,153\n \n\nForeign currency translation\n \n \n3,392\n \n\n**Balance at December 31, 2021**\n \n \n517,814\n \n\nIssuance of Class A Ordinary Shares and warrant\n \n \n18,463\n \n\nEquity in earnings of WOFE\n \n \n(10,284\n)\n\nEquity in earnings of VIE\n \n \n \n \n\nEquity in earnings of VIE’s subsidiaries\n \n \n(277,443\n)\n\nDividend distributed to shareholders\n \n \n \n \n\nShare-based compensation\n \n \n14,714\n \n\nForeign currency translation\n \n \n(27,497\n)\n\n**Balance at December 31, 2022**\n \n \n235,767\n \n\nIssuance of Class A Ordinary Shares and warrant\n \n \n17,884\n \n\nEquity in earnings of WOFE\n \n \n(11,311\n)\n\nEquity in earnings of VIE\n \n \n-\n \n\nEquity in earnings of VIE’s subsidiaries\n \n \n32,933\n \n\nDividend distributed to shareholders\n \n \n-\n \n\nShare-based compensation\n \n \n7,264\n \n\nForeign currency translation\n \n \n(5,112\n)\n\n**Balance at December 31, 2023**\n \n \n277,425\n \n\nIssuance of Class A Ordinary Shares and warrant\n \n \n24,838\n \n\nEquity in earnings of WOFE\n \n \n(20,255\n)\n\nEquity in earnings of VIE\n \n \n-\n \n\nEquity in earnings of VIE’s subsidiaries\n \n \n(26,723\n)\n\nShare-based compensation\n \n \n17,540\n \n\nForeign currency translation\n \n \n(3,047\n)\n\n**Balance at December 31, 2024**\n \n \n269,778\n \n\nIssuance of Class A Ordinary Shares and warrant\n \n \n15,788\n \n\nEquity in earnings of WOFE\n \n \n(16,410\n)\n\nEquity in earnings of VIE\n \n \n-\n \n\nEquity in earnings of VIE’s subsidiaries\n \n \n(86,546\n)\n\nShare-based compensation\n \n \n7,170\n \n\nForeign currency translation\n \n \n5,865\n \n\n**Balance at December 31, 2025**\n \n \n195,645\n \n\n \n\n40\n\n \n\n \n\n**B.\nBusiness Overview**\n\n \n\nWe\nare primarily a commodities trading company, operating through its subsidiaries SOS International Trading Co. Ltd, Shuyun International\nTrading Co. Ltd and Weigou International Trading Co. Ltd, facilitating the trading of commodities including but not limited to mineral\nresin, soy bean, wheat, sesame, liquid sulfur and latex. The Company also operates as an emerging blockchain-based and big data-driven\nmarketing solution provider and is engaged in blockchain and cryptocurrency operations, which currently include providing hosting services\nto third-party cryptocurrency miners.\n\n \n\nOur\ncommodities trading business is our primary revenue-generating segment. For the fiscal year ended December 31, 2025, commodities trading\nrevenues constituted the substantial majority of our total revenues. We operate our commodities trading business by identifying suppliers\nand buyers and earning the price differential on each transaction. Revenue is recognized upon delivery and transfer of title and risk\nof loss to the buyer.\n\n \n\nIn\n2025, we temporarily shut down mining operations as the mining rigs were no longer cost-effective, and we transitioned\nto attracting customers to mine on our premises, earning hosting fees. As a result, our cryptocurrency-related revenues in fiscal year\n2025 are derived primarily from hosting services rather than direct mining activity. We continue to hold digital assets on our balance\nsheet, including Bitcoin and Ethereum, which as of December 31, 2025 included approximately 802.77 BTC and 2,949.79 ETH.\n\n \n\nThe Company\nprovides substantially all of its services to large businesses and small and medium-sized enterprises (“SMEs”) in China. The\nCompany previously operated through a variable interest entity (“VIE”) structure, which was disposed of on November 2, 2022,\nand the VIE structure is no longer part of the Company’s corporate structure.\n\n \n\n**Our\nProducts and Services**\n\n \n\nWe\nfocus on three service lines including Commodities Trading, Hosting service and Others. As of December 31, 2025, our total revenues were\n$152.1 million, including commodities trading revenues of $142.8 million. Hosting Service revenues of $7.5 million and other revenues\nof $1.67 million.\n\n \n\nRevenue\nby Products and Services\n\n \n\n  \nFor\nthe year ended\nDecember 31, 2025 \n\nRevenue\nby Products and Services \nUS$  \nPercentage \n\nCommodities Trading \n 144,974  \n 93.9%\n\nCryptocurrency Mining \n -  \n -%\n\nHosting Services \n 7,501  \n 4.9%\n\nOthers \n 1,815  \n 1.2%\n\nTotal revenue -net \n$154,290  \n 100%\n\n  \n\n  \nFor\nthe year ended\nDecember 31, 2024 \n\nRevenue\nby Products and Services \nUS$  \nPercentage \n\nCommodities Trading \n 214,340  \n 92.6%\n\nCryptocurrency Mining \n 9,258  \n 4.0%\n\nHosting Services \n 6,506  \n 2.8%\n\nOthers \n 1,320  \n 0.6%\n\nTotal revenue -net \n$231,424  \n 100%\n\n \n\n**Commodity\nTrading**\n\n* *\n\nSince\nApril 2021, we launched our commodities trading business via our subsidiaries including SOS International Trading Co. Ltd., Shuyun International\nTrading Co Ltd and Weigou International Trading, and we facilitate the trading of commodities including but not limited to mineral resin,\nsoy bean, wheat, sesame, liquid sulfur, petrol coke and latex. We identify suppliers and buyers and generate revenue from the price difference.\nRevenue is recognized after products have been delivered and title to the goods and risk has been transferred from a seller to a buyer.\n\n \n\n**Cryptocurrency\nMining  **\n\n** **\n\nWe\ngenerate revenues by selling cryptocurrencies allocated from those cryptocurrency-mining pools and also anticipate to rent out hash power\nto third parties. The value of cryptocurrencies is determined based on the market prices of the related cryptocurrencies at the time\nof receipt. The rental fees of hash power are also determined proportionally based on the market prices of the related cryptocurrencies.\nWe are currently focusing on the mining of the key mainstream cryptocurrencies such as Bitcoin and Ethereum\n\n \n\n41\n\n \n\n \n\n**Hosting\nServices**\n\n \n\nFrom\nJanuary 2022, SOS took the initiative to build a super-computing center in Wisconsin USA by providing individual & business users\na comprehensive experience of cryptocurrency mining hosting service. Part of the facility was up and running since April 2022 and we\nrecorded a revenue of $7.5 million and $6.5 million for the twelve months ended December 31, 2025 and 2024 respectively.\n\n \n\n**Competition**\n\n \n\nWe\nhave begun penetrating into the cryptocurrency mining industry towards the end of 2020. In the cryptocurrency mining business, companies,\ngroups and individuals generate units of bitcoin through mining pools. Miners can range from individual enthusiasts to professional mining\noperations with dedicated data centers.\n\n \n\nSources\nof information in public domain include “bitcoin.org” and “blockchain.info.” We believe that our competitors\ninclude public companies engaging in the cryptocurrency mining business that are listed either on the U.S. or international stock exchanges,\nsuch as Bit-digital.com, The9.com, Overstock.com Inc, Bitcoin Investment Trust, Blockchain Industries, Inc, (formerly Omni Global Technologies,\nInc.), Bitfarms Technologies Ltd. (formerly Blockchain Mining Ltd), DMG Blockchain Solutions Inc, Hive Blockchain Technologies Inc, Hut\n8 Mining Corp, HashChain Technology, Inc, MGT Capital Investments, Inc, DPW Holdings, Inc, Layer1 Technologies, LLC, Northern Data AG,\nRiot Blockchain, Inc and Marathon Digital Holdings.  The cryptocurrency mining industry is a highly competitive and rapidly changing\nindustry and new competitors could enter the market and affect our competitiveness in the future. For more information regarding those\nrisk factors known to us, please see the “Risk Factors” section, “Risks Related to Our Data Mining and Analysis Business”.\n\n \n\n**Intellectual\nProperty**\n\n \n\nWe\nregard our trademarks, domain names, know-how, proprietary technologies and similar intellectual property as critical to our success,\nand we rely on trademark and trade secret law and confidentiality and invention assignment with our employees and others to protect our\nproprietary rights.\n\n \n\nThe\nCompany has 99 registered software copyrights, 2 granted utility model patents and 1 domain name. Despite our efforts to protect our\nproprietary rights, unauthorized parties may attempt to copy or otherwise obtain and use our technology. Monitoring unauthorized use\nof our technology is difficult and costly, and we cannot be certain that the steps we have taken will prevent misappropriation of our\ntechnology. From time to time, we may have to resort to litigation to enforce our intellectual property rights, which could result in\nsubstantial costs and diversion of our resources. In addition, third parties may initiate litigation against us alleging infringement\nof their proprietary rights or declaring their non-infringement of our intellectual property rights. In the event of a successful claim\nof infringement and our failure or inability to develop non-infringing technology or license the infringed or similar technology on a\ntimely basis, our business could be harmed. Moreover, even if we are able to license the infringed or similar technology, license fees\ncould be substantial and may adversely affect our results of operations.\n\n \n\n**Corporate\nInformation**\n\n \n\nOur\nprincipal executive office is located at Building 6, East Seaview Park, 298 Haijing Road, Yinzhu Street, West Coast New District, Qingdao\nCity, Shandong Province, People’s Republic of China 266400. Our telephone number is +86-532-86617117. We maintain a website at\nhttp://www.sosyun.com/ that contains information about our Company, and we make available free of charge through our website our annual\nreport on Form 20-F, current reports on Form 6-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d)\nof the Securities Exchange Act of 1934, as amended, or the Exchange Act, as soon as reasonably practicable after we electronically file\nsuch material with, or furnish it to, the SEC.\n\n \n\n42\n\n \n\n \n\n**Regulation**\n\n \n\n*U.S. Regulations\nand Policies Relating to Blockchain and Cryptocurrencies*\n\n \n\nBlockchain\nand cryptocurrencies are increasingly becoming subject to governmental regulation, both in the U.S. and internationally. State and local\nregulations also may apply to our activities and other activities in which we may participate in the future. Other governmental or semi-governmental\nregulatory bodies have shown an interest in regulating or investigating companies engaged in the blockchain or cryptocurrency business.\nFor instance, the Cyber-Digital Task Force of the U.S. Department of Justice (the “DOJ”) published a report entitled “Cryptocurrency:\nAn Enforcement Framework” in October 2020. This report provides a comprehensive overview of the possible threats and enforcement\nchallenges the DOJ views as associated with the use and prevalence of cryptocurrency, as well as the regulatory and investigatory means\nthe DOJ has at its disposal to deal with these possible threats and challenges. Further, in early March 2021, the SEC chairperson nominee\nexpressed an intent to focus on investor protection issues raised by bitcoin and other cryptocurrencies.\n\n \n\nPresently,\nwe do not believe any U.S. or State regulatory body has taken any action or position adverse to our main cryptocurrency, bitcoin, with\nrespect to its production, sale, and use as a medium of exchange; however, future changes to existing regulations or entirely new regulations\nmay affect our business in ways it is not presently possible for us to predict with any reasonable degree of reliability.\n\n \n\nFurther,\nfollowing the appreciation of the market price of bitcoin in the second half of 2020, we have observed increasing media attention directed\nat the environmental concerns associated with cryptocurrency mining, particularly its energy-intensive nature. We do not believe any\nU.S.-based regulators have taken a position adverse to bitcoin mining thus far.\n\n \n\nAs\nthe regulatory and legal environment evolves, we may become subject to new laws, such as further regulation by the SEC and other agencies,\nwhich may affect our mining and other activities. For additional discussion regarding our belief about the potential risks existing and\nfuture regulation pose to our business, see the Section entitled “Risk Factors” herein.\n\n \n\n*Chinese\nRegulations on Cryptocurrency in General*\n\n \n\nAccording\nto the Circular of the People’s Bank of China, Ministry of Industry and Information Technology, China Banking Regulatory Commission,\nChina Securities Regulatory Commission, and China Insurance Regulatory Commission on Guarding against Bitcoin Risks issued on December\n3, 2013, or the 2013 Circular, Bitcoin should be regarded as a specific virtual commodity, and it does not possess the status that a\nlegal currency has, and cannot and should not be circulated in market as a currency. The 2013 Circular also provides that financial institutions\nand payment institutions shall not engage in business in connection with Bitcoin.\n\n \n\nAnother\nnotable law on recognition of virtual property is the PRC Civil Code, which became effective on January 1, 2021. Article 127 of PRC Civil\nCode provides that: “Where laws contain provisions in respect of the protection of data and network virtual property, such provisions\nshall apply.” We believe that this provision together with the 2013 Circular recognizes the lawful possession by PRC citizens and\norganizations of Bitcoin as a kind of virtual property.\n\n \n\nAccording\nto the Announcement of the People’s Bank of China, the Office of the Central Cyberspace Security and Informatization Leading Group,\nthe Ministry of Industry and Information Technology, the State Administration for Industry and Commerce, the China Banking Regulatory\nCommission, the China Securities Regulatory Commission and the China Insurance Regulatory Commission on Preventing Token Fundraising\nRisks issued on September 4, 2017, or the 2017 Announcement, activities of offering and financing of tokens, including initial coin offerings,\nor ICOs, should be forbidden in the PRC since they are essentially illegal public financing activities, which are suspected to involve\nfinancial crimes such as illegal distribution of financial tokens, illegal issuance of securities, illegal fundraising, financial fraud\nor pyramid sales. All so-called token trading platforms should not (i) engage in any exchange between any fiat currency with tokens or\n“virtual currencies”, (ii) trade tokens or “virtual currencies” or trade them as central counterparties, or (iii)\nprovide pricing, information agency or other services for tokens or “virtual currencies”. The 2017 Announcement further orders\nthat financial institutions and non-banking payment institutions should not do any business related to token trading.\n\n \n\n43\n\n \n\n \n\nAccording\nto the Risk Warning on Preventing Illegal Fundraising in the Name of “Virtual Currency” or “Blockchain” jointly\npromulgated by the Banking and Insurance Regulatory Commission, the Office of the Central Cyberspace Affairs Commission, the Ministry\nof Public Security, the People’s Bank of China and the State Administration for Market Regulation on August 24, 2018, or the 2018\nWarning, raising funds through the issuance of so-called “virtual currency”, “virtual asset” or “digital\nasset” under the flag of “financial innovation” or “blockchain” is not based on real blockchain technology,\nbut rather the practice of using speculative blockchain concepts for illegal fundraising, pyramid schemes, or fraud. The 2018 Warning\nreiterates the position of the Chinese government on ICOs.\n\n \n\nDespite\nthe Chinese government’s resentment of non-government backed cryptocurrencies in general, China has been testing digital Renminbi\nthrough pilot programs. On October 23, 2020, the People’s Bank of China published the revised Law of the People’s Republic\nof China on the People’s Bank of China (draft), or the draft PBOC Law, to solicit comment from the public. Article 19 of the draft\nPBOC Law provides that Renminbi may take a physical form or a digital form. This draft PBOC Law, if enacted, will pave the way for the\nformal launch of digital Renminbi. However, Article 22 of the draft PBOC Law reiterates that no entity or individual should produce or\noffer coupon tokens or digital tokens to replace Renminbi for circulation in market. This has been the consistent position of the Chinese\ngovernment since 2013.\n\n \n\n*Chinese\nRegulations on Cryptocurrency Mining*\n\n \n\nCryptocurrency\nmining is not prohibited by Chinese laws, but is subject to an unclear and evolving regulatory and policy framework in China. On January\n2, 2018, China’s Leading Special Task Team for Remediation of Internet Financial Risks mandates that local governments should take\nmeasures of electricity prices, taxes, or land use, to guide the orderly exit of entities from cryptocurrency mining operations and that\nlocal governments must submit reports on cryptocurrency mining operations in their respective jurisdictions to the task team on a regular\nbasis. Since then, local regulations on cryptocurrency mining have been tightened, at least in some Chinese provinces, such as Xinjiang\nand Inner Mongolia.\n\n \n\nAt\nthe beginning of 2021, which is the first year of the “14th Five-Year Plan” of China, the National Development and Reform\nCommission of China publicly emphasized the need to improve the dual control system for energy consumption, to solidly promote working\ntowards carbon peaking and carbon neutrality, and to accelerate the elimination of outdated and inefficient excess production capacity.\nOn March 9, 2021, the Inner Mongolia Development and Reform Commission and two other local governmental agencies jointly published the\nCertain Safeguard Measures to Ensure Completion of the “14th Five-Year Plan” Goals on Dual Control of Energy Consumption,\nor the Safeguard Measures. The Safeguard Measures order that, cryptocurrency mining projects in Inner Mongolia should be completely cleaned\nup and shut down by the end of April 2021. So far, no similar orders have been published by the government of Sichuan Province, in which\nprovince the three mining farms of the Company reside.\n\n \n\nThe\nGuidance Catalogue of Industry Structural Adjustment (2019 Edition), or the 2019 Guidance Catalogue, promulgated by the National Development\nand Reform Commission, became effective on January 1, 2020. The 2019 Guidance Catalogue contains a catch-all clause which provides that,\nif any process, technology, products or equipment is not in compliance with (a) the Law of the People’s Republic of China on Prevention\nand Control of Atmospheric Pollution, the Law of the People’s Republic of China on Prevention and Control of Water Pollution, the\nLaw of the People’s Republic of China on Prevention and Control of Environmental Pollution Caused by Solid Wastes, the Energy Conservation\nLaw of the People’s Republic of China, the Work Safety Law of the People’s Republic of China, the Product Quality Law of\nthe People’s Republic of China, the Land Administration Law of the People’s Republic of China, the Law of the People’s\nRepublic of China on Prevention& Control of Occupational Diseases or other laws and regulations, (b) national mandatory standards\nfor safety, environmental protection, energy consumption and quality, or (c) the requirements of international environmental conventions\nor other requirements, they should be restricted or eliminated. We cannot exclude the possibility that the National Development and Reform\nCommission of China restricts or even prohibits mining operations in China on the basis that mining operations fall under the above-mentioned\ncatch-all clause. The National Development and Reform Commission of China may even update the “Guidance Catalogue for Industry\nStructural Adjustment” to explicitly restrict or prohibit mining operations in China.\n\n \n\n*Regulations\non Registration of Blockchain Information Service Providers*\n\n \n\nEntities\nor nodes providing information services based on blockchain technologies or systems in China are required to be registered with the Cyberspace\nAdministration of China. According to the Administrative Regulations on Blockchain Information Services issued by the Cyberspace Administration\nof China and effective on February 15, 2019, or the Blockchain Regulation, blockchain information services shall refer to information\nservices provided to the public through internet sites, applications, etc. based on blockchain technologies or systems. The Blockchain\nRegulations also provide that, a provider of blockchain information services shall fill in its name, service category, service form,\napplication domain, server address and other information through the management system of blockchain information services established\nby the Cyberspace Administration of China. We do not believe we should make such filing with the Cyberspace Administration of China based\non our current business operations. However, uncertainties exist regarding the interpretation and implementation of the Blockchain Regulation,\nand future Chinese laws and regulations may require us to register or file with Chinese cyberspace authorities. \n\n \n\n44\n\n \n\n \n\n**C.\nOrganizational Structure**\n\n \n\nSee “—A.\nHistory and Development of the Company.”\n\n \n\n**D.\nProperty, Plant and Equipment**\n\n \n\nOn\nSeptember 1, 2023, we rented an office at 866 Second Avenue, New York, New York 10017, with 1457 square feet for our operations in the\nUnited States. The contract was terminated on Aug, 2024. The new virtual office lease agreement was signed on February 5, 2025 with monthly\nprice of $189.60 and is effective through February 28, 2027."}