Yes, Company owns the Company brand.
On November 4, 2021, Company entered into trademark license agreements with a related party (“Trademark License Agreements”), Subsidiary A, a wholly owned subsidiary of Subsidiary B, which is ultimately controlled by the Controlling Shareholder of Company. Pursuant to the Trademark License Agreements, Company received the “Company” trademark licenses for as long as Company conducts business in relation to lifestyle vehicles (excluding sports cars): i) exclusively on lifestyle vehicles and parts and components related to those lifestyle vehicles that Company designs, develops, manufactures, assembles, distributes, and sells or has designed, developed, manufactured, or assembled by any third party; ii) non-exclusively for Company’s business of providing related after-sale services for the lifestyle vehicles; iii) non-exclusively on related products (excluding anything relating to sports cars) such as accessories that Company designs, produces, distributes, and sells or has designed or produced by any third party on its behalf; iv) any other occasions in relation to the business conducted by Company as duly approved by Company’s Board (excluding anything relating to sports cars). On November 4, 2021, Subsidiary A, a wholly owned subsidiary of Subsidiary B, which is ultimately controlled by the Controlling Shareholder of the Company, entered into trademark license agreements with a related party (“Trademark License Agreements”). Pursuant to the Trademark License Agreements, the Group received the “Company” trademark licenses for as long as the Group conducts business related to lifestyle vehicles (excluding sports cars): i) exclusively for lifestyle vehicles and parts and components related to those vehicles that the Group designs, develops, manufactures, assembles, distributes, and sells, or has designed, developed, manufactured, or assembled by any third party; ii) non-exclusively for the Group’s business of providing related after-sale services for lifestyle vehicles; iii) non-exclusively for related products (excluding anything relating to sports cars), such as accessories that the Group designs, produces, distributes, and sells, or has designed or produced by any third party on its behalf; iv) any other occasions related to the business conducted by the Group as duly approved by the Group’s Board (excluding anything relating to sports cars). The Group intends to market and distribute its products under the “Company” brand indefinitely, and the trademark licenses are expected to contribute to cash flows indefinitely.
There is no assurance that Company's vehicles will maintain and strengthen a reputation comparable to that of Company’ sports vehicle segment. If Company fails to do so, it may lose the opportunity to build a critical mass of customers. Promoting and positioning the brand will likely depend significantly on Company's ability to provide high-quality vehicles and services and engage with customers as intended, and the company has limited experience in these areas. In addition, Company expects that its ability to develop, maintain, and strengthen the brand will depend heavily on the success of its branding efforts. Company markets the brand through media, word-of-mouth, events, and advertising. Such efforts may not achieve the desired results. If Company does not maintain and strengthen a strong brand, its business, financial condition, results of operations, and prospects will be materially and adversely affected. The trademark licenses granted to Company to use the “Company” brand are on a royalty-free and worldwide basis and are for use of the trademarks (i) exclusively (subject to any existing licenses already granted) for lifestyle vehicles and parts and components in relation thereto that Company designs, develops, manufactures, assembles, distributes, and sells; Company's cloud security policies seek to enable secure cloud architecture deployments and extend security capabilities. Utilizing signed certificates, encryption keys, message authentication codes, and cryptographic algorithms, Company has deployed authentication and encryption as part of its efforts to secure its products, software, vehicles and their components, and over-the-air updates. Additionally, Company utilizes pre-condition checks, sequence and dependency execution, failure detection, and rollback and recovery when performing updates during the over-the-air process. Company faces competition from both traditional luxury automotive developers and an increasing number of newer companies focused on electric and other alternative fuel vehicles. Company believes the primary competitive factors on which Company competes with its peers include, but are not limited to: Company has operations across the UK, the EU, and China. The company is dedicated to delivering luxury lifestyle battery electric vehicles, with a focus on world-class research and development in next-generation automobility technologies such as electrification, digitalization, and more. For more information about Company, please visit www.group-Company.com. Company believes that its close relationship with Counterparty A provides the company with a unique competitive advantage in its ability to rapidly scale commercialization while maintaining an asset-light operating model with less upfront capital expenditure commitment than other original equipment manufacturers (OEMs). Company has entered into a variety of agreements, including agreements related to technology licensing, manufacturing cooperation, and supply of framework, among others, with Counterparty A. This strategic partnership with Counterparty A allows Company to effectively control supply chain-related risks and accelerate product development. Since Company is not the owner of the trademarks in the “Company” brand, Company depends on the ability of Subsidiary C to obtain, maintain, and enforce such trademarks in the “Company” brand. While Company is able to request that Subsidiary C file additional, similar trademark applications to those that are currently licensed, Subsidiary C may determine not to pursue such applications. Furthermore, Subsidiary C may determine not to adequately protect or pursue litigation against other companies or may pursue such litigation less aggressively than Company would. Additionally, Subsidiary C may allege that Company has breached the license agreement with them and accordingly seek to terminate the license, which could adversely affect Company's competitive business position and harm its business prospects. Licensing of trademarks involves complex legal and business issues. Disputes may arise regarding trademarks subject to such licensing agreements, including (i) the scope of rights granted under such licensing agreements and other interpretation-related issues; and (ii) Company's diligence obligations under the licensing agreement and what activities satisfy those diligence obligations. ● brand recognition, prestige, and heritage; ● design, styling, and luxury; ● technological innovation; ● driver experience; ● product quality and performance; ● product reliability and safety; ● battery range, efficiency, and charging speeds; ● customer service and customer experience, including access to charging options and availability and terms of aftersales services; ● product pricing; ● management team experience in bringing electric vehicles and other disruptive technologies to market; ● manufacturing efficiency; ● environmental impact and perception; ● the degree and sophistication of related vehicle software. Company believes that the company is favorably positioned to compete on the basis of these factors. However, many of its current and potential competitors have substantially greater financial, technical, manufacturing, marketing, and other resources than Company. These competitors may be able to deploy greater resources to the design, development, manufacturing, distribution, promotion, sales, marketing, and support of their products. Additionally, many of these competitors also have greater name recognition, longer operating histories, larger sales forces, broader customer and industry relationships, and other tangible and intangible resources that exceed those of Company. On November 11, 2021, Company issued 95,990,886 ordinary shares to Subsidiary A, which is ultimately 100% owned by Counterparty A. Through a series of reorganization steps (the “Reorganization”), including transferring the assets and employees in the Company BEV business unit of Ningbo Counterparty A R&D into Wuhan Subsidiary B and transferring the equity of Wuhan Subsidiary B to the Wholly Foreign-Owned Enterprise (WFOE), Company gained control over the WFOE through Subsidiary C on December 15, 2021. The equity interests of Subsidiary D and Subsidiary E were also transferred to the Group on December 29, 2021, and June 24, 2022, respectively. On November 4, 2021, Company entered into trademark license agreements with a related party, Subsidiary F, a wholly owned subsidiary of Subsidiary G, which is ultimately controlled by Person A. Pursuant to this agreement, Company received the “Company” trademark licenses for as long as Company conducts business in relation to lifestyle vehicles (excluding sports cars). Company issued 47,995,443 ordinary shares as consideration for such trademark licenses. The above Reorganization was completed on June 24, 2022. Company believes that its close relationship with Counterparty A provides the company with a unique competitive advantage in its ability to rapidly scale commercialization while maintaining an asset-light operating model with less upfront capital expenditure commitment than other original equipment manufacturers (OEMs). Company has entered into a variety of agreements, including agreements related to technology licensing, manufacturing cooperation, and supply of framework, among others, with Counterparty A. The strategic partnership with Counterparty A allows Company to effectively control supply chain-related risks and accelerate product development. Company's ability to successfully operate its Global Commercial Platform will affect its ability to increase revenues. Company has taken steps to diversify its revenue sources, for example, by entering into the Distribution Agreement with Subsidiary A, pursuant to which Company is the exclusive global distributor (excluding the U.S., where Subsidiary B will act as the head distributor with the existing regional distributor continuing its functions) for Subsidiary A to distribute Subsidiary A vehicles, parts, and certain tools, and to provide aftersales services, branding, marketing, and public relations for such vehicles, parts, and tools distributed by Company. These competitors also compete with Company in recruiting and retaining qualified research and development, sales, marketing, and management personnel, as well as in acquiring technologies complementary to, or necessary for, its products. Additional mergers and acquisitions in the electric vehicle and luxury automotive markets may result in even more resources being concentrated in these competitors. Company believes that its brand and history, its focus on design and experience, its advanced technologies, its relationship with Counterparty A and therefore the benefits it can obtain during the vehicle development phase, and its future-proof approach give it a competitive edge and allow it to formulate a highly differentiated go-to-market strategy. Company also has a scalable asset-light business model that it believes generates significant competitive advantages, allowing it to incur less upfront capital expenditure and focus on research and development and technologies. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of Company's outstanding voting shares within the past three years. This has the effect of limiting the ability of a potential acquirer to make a two-tiered bid for Company in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors of Company approves either the business combination or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with Company's board of directors. Cayman Islands law has no comparable statute. As a result, Company cannot avail itself of the types of protections afforded by the Delaware business combination statute. Company aims to deliver high-quality products and services to its customers in line with its core values and commitments. Company believes that quality assurance is key to ensuring the delivery of high-quality products and services, minimizing waste, and maximizing efficiency. Quality management has been strongly emphasized across all business functions, including product development, manufacturing, supplier quality management, procurement, charging solutions, customer experience, servicing, and logistics. Company's quality management groups are responsible for the overall quality strategy, quality systems and processes, quality culture, and general quality management implementation. During product development, several phases of testing have been implemented to verify design and production quality. Company's quality standards are guided by industry standards, including ISO9001, R155 CSMS, R156 SUMS, Aspice L2, ISO26262, and ISO/SAE 21434. Company's first volume-manufactured vehicle, the Eletre, is produced at a new plant operated by Counterparty A in accordance with quality standards. All production lines, including stamping, welding, painting, and general assembly, are developed in compliance with industry standards and feature a higher degree of automation. Company applies more than 4,000 standards across all phases of product development and supplier quality management. If Company is unable to maintain collaboration with Counterparty A, its financial performance would be directly and adversely affected. There can be no assurance that in such an event Company would be able to partner with other third parties to meet its needs on acceptable terms or at all. The expense and time required to complete any transition, and to ensure that vehicles manufactured at facilities of new third-party partners comply with Company's quality standards and regulatory requirements, may be greater than anticipated. Any of the foregoing could adversely affect Company's business, results of operations, financial condition, and prospects. Furthermore, Company's supply chain efficiency also relies heavily on Counterparty A, largely attributable to Counterparty A's bargaining power derived from its volume and reputation. Failure to maintain agreements or partnerships with Counterparty A could adversely affect Company's relationships with suppliers, and there is no assurance that in such an event Company would be able to maintain relationships with current suppliers or secure new suppliers to meet its needs on comparable and acceptable terms. Based on Company's assets and income, Company does not believe that it was a PFIC for the taxable year ended December 31, 2023, and does not expect to be a PFIC for the current taxable year or foreseeable future taxable years. However, the facts on which any determination of PFIC status is based are not known until the close of each taxable year in question. U.S. Holders should consult their tax advisors regarding the application of the PFIC rules to Company and the risks of owning equity securities in a company that may be a PFIC. See “Taxation   —   U.S. Federal Income Tax Considerations   —   Passive Foreign Investment Company Considerations.” Company seeks to partner with reputable suppliers. Company leverages the Counterparty A ecosystem for the order of basic auto parts. Company intends to use most of the same core suppliers for its vehicles. Company has developed close relationships with key suppliers. These include Counterparty B, a global leader in AI computing, which provides its chips for the advanced driver-assistance systems (ADAS) used in Company's vehicles; Counterparty C, a leading developer of semiconductor technologies, which provides 8155 smart cockpit chips; and Counterparty D, a leading manufacturer of lithium-ion batteries, which supplies batteries for Company's battery electric vehicles (BEVs). Most of these suppliers are key partners in the Counterparty A ecosystem and have years of strong partnership with Counterparty A. Company follows its internal process to select suppliers, taking into account quality, cost, and timing. Company has a part quality management team responsible for managing and ensuring that suppliers meet quality standards. The method for selecting suppliers depends on the nature of the supplies needed. For general parts that are widely available, Company examines proposals from multiple suppliers and chooses based on quality and price competitiveness, among other factors. Company collaborates with a battery electric vehicle (BEV) manufacturing facility in Wuhan, China, which is owned and operated by Counterparty A. This manufacturing plant is purpose-built for electric vehicles and incorporates advanced manufacturing technologies. Covering an area of over one million square meters, the plant has the capacity to produce up to 150,000 vehicles per year. The facility has been constructed as a brand-new, world-class plant for the production of electric vehicles. The plant is equipped to conduct stamping, welding, painting, and assembly, and features testing tracks, a quality inspection center, and a utility power and sewage treatment center. It includes an advanced system that allows vehicles to be transported into workshops using intelligent driving technology without any human intervention. The facility is also equipped with an approximately three-kilometer-long track for quality inspection. Customers can experience various driving activities such as racing, drifting, and off-roading on the track. The track includes nine left turns and seven right turns and can accommodate vehicles driving at speeds of up to 230 kilometers per hour in a straight line. For parts requiring special designs, Company reviews design proposals and chooses largely based on design-related factors. However, in certain cases, Company has limited choices given its scale, such as battery cell packages, so in such circumstances, Company typically partners with suppliers that it believes to be well-positioned to meet its needs. In addition, when part suppliers are selected, Company has established certain environmental guidelines in accordance with its ESG strategies and goals. If neither Company nor Counterparty A Holding enters into long-term supplier agreements with guaranteed pricing for parts or components, Company may be exposed to fluctuations in prices of components, materials, and equipment. For more details, see “—Risks Relating to Our Business and Industry — We are dependent on our suppliers, many of whom are our single source suppliers for the components they supply” and “—Risks Relating to Our Business and Industry — We could experience cost increases or disruptions in supply of raw materials or other components used in our vehicles.” Company may not succeed in continuing to maintain and strengthen its brand, and its brand and reputation could be harmed by negative publicity with respect to Company, its directors, officers, employees, shareholders, peers, business partners, or the automotive industry in general. Company's business and prospects will heavily depend on its ability to maintain and strengthen the “Company” brand associated with design, sustainability, and technological excellence. Company obtained licenses from Counterparty B to use the trademarks in the “Company” brand on lifestyle vehicles, parts, and components. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of the corporation’s outstanding voting shares within the past three years. This has the effect of limiting the ability of a potential acquirer to make a two-tiered bid for the corporation in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with the corporation’s board of directors. Cayman Islands law has no comparable statute. As a result, Company cannot avail itself of the types of protections afforded by the Delaware business combination statute. However, although Cayman Islands law does not regulate transactions between a company and its significant shareholders, it does provide that such transactions must be entered into bona fide in the best interests of the company and not with the effect of constituting a fraud on the minority shareholders. Dissolution; Company is a luxury battery electric vehicle (BEV) manufacturer that designs, develops, and sells luxury lifestyle vehicles under the iconic British brand “Company.” With over seven decades of heritage and proven leadership in racetrack and road cars, the Company brand symbolizes market-leading standards in performance, design, and engineering. The first lifestyle production vehicle, Eletre, is a new breed of pure electric SUV powered by Company’s proprietary 800-volt electric powertrain architecture (EPA). Deliveries of the Eletre commenced in China and Europe in 2023. Planning is underway for deliveries to the U.S. and the rest of the world. The second lifestyle production vehicle, Emeya, was launched in September 2023, and deliveries of the Emeya began in March 2024. In addition to the Eletre and Emeya, Company plans to launch two additional fully electric vehicles in the near future, including a D-segment SUV in 2025 and a BEV sports car in 2026. Company also plans to upgrade its models on an ongoing basis. The Company brand was founded in the U.K. in 1948 and has since established itself as a high-performance luxury vehicle brand with innovative engineering and cutting-edge technologies, renowned for its superior aerodynamics and lightweight design. The Company brand was born out of legendary success on the racetrack, including 13 FIA Formula 1 world titles and many other championship honors. In 2017, Counterparty A acquired a 51% stake in Subsidiary A and further positioned the company as a luxury lifestyle battery electric vehicle (BEV) manufacturer. Counterparty A, a global mobility technology group with a proven track record in seeding BEV brands, has successfully incubated and revitalized a series of world-renowned brands with attractive financial profiles, including Volvo, Polestar, LYNK&CO., and Zeekr. Positioned as the only Counterparty A-affiliated brand with sports car DNA, Company has received comprehensive support from Counterparty A in manufacturing, supply chain, research and development, logistics infrastructure, and human capital, and is in the process of transforming from a British sports car company to a global pioneer of high-performance electric vehicles to bridge the gap between traditional sports cars and a new generation of electric vehicles. If neither Company nor Counterparty A Holding enters into longer-term supplier agreements with guaranteed pricing for parts or components, Company may be exposed to fluctuations in prices of components, materials, and equipment. For more details, see “—Risks Relating to Our Business and Industry — We are dependent on our suppliers, many of whom are our single source suppliers for the components they supply” and “—Risks Relating to Our Business and Industry — We could experience cost increases or disruptions in supply of raw materials or other components used in our vehicles.” Company may not succeed in continuing to maintain and strengthen its brand, and its brand and reputation could be harmed by negative publicity with respect to Company, its directors, officers, employees, shareholders, peers, business partners, or the automotive industry in general. Company's business and prospects will heavily depend on its ability to maintain and strengthen the “Company” brand associated with design, sustainability, and technological excellence. Company obtained licenses from Counterparty B to use the trademarks in the “Company” brand on lifestyle vehicles, parts, and components. Additionally, many of these competitors also have greater name recognition, longer operating histories, larger sales forces, broader customer and industry relationships, and other tangible and intangible resources that exceed those of Company. These competitors also compete with Company in recruiting and retaining qualified research and development, sales, marketing, and management personnel, as well as in acquiring technologies complementary to, or necessary for, the company's products. Additional mergers and acquisitions in the electric vehicle and luxury automotive markets may result in even more resources being concentrated in Company's competitors. Company believes that its brand and history, focus on design and experience, advanced technologies, relationship with Counterparty A, and the benefits obtained during the vehicle development phase, along with its future-proof approach, provide a competitive edge and enable the formulation of a highly differentiated go-to-market strategy. Company also has a scalable asset-light business model that is believed to generate significant competitive advantages, allowing the company to incur less upfront capital expenditure and focus on research and development and technologies. As of June 30, 2024, Company had 207 stores in its global distribution network. Major vehicle models currently in Company's global sales and distribution network include Eletre, Emeya, and future lifestyle models, as well as certain sports car models that were or will be developed and manufactured by Subsidiary B, such as Evija (BEV sports car) and Emira (ICE sports car). Key Components of Results of Operations Company generates revenues primarily through sales of goods and services. Sales of goods. Company generates revenues by providing the following products: ● Battery Electric Vehicle (BEV) lifestyle models developed by Company;  
● Company-brand sports cars developed by Subsidiary B;  
● auto parts; and  
● peripheral products. ● The automotive market is highly competitive, and Company may not be successful in competing in this industry. Company's reliance on a variety of arrangements with Counterparty A, such as agreements related to research and development, procurement, manufacturing, engineering, and IT and human resource-related supporting services, could subject the company to risks.  
● Company may not succeed in continuing to maintain and strengthen its brand, and its brand and reputation could be harmed by negative publicity with respect to the company, its directors, officers, employees, shareholders, peers, business partners, or the automotive industry in general.  
● Company has a limited operating history, and its ability to develop, manufacture, and deliver automobiles of high quality and appeal to customers, on schedule, and on a large scale is unproven and still evolving.  
● Company has not been profitable and has experienced negative net cash flows from operations. If the company does not effectively manage its cash and other liquid financial assets, execute its plan to increase profitability, and obtain additional financing, it may not be able to continue as a going concern. As mentioned in note 21, on January 31, 2023, Company C entered into a distribution agreement with Subsidiary B (“Subsidiary F”), a wholly owned subsidiary of Subsidiary D and ultimately controlled by the Controlling Shareholder of the Company. Pursuant to this agreement, Company C was appointed as the exclusive global distributor (excluding the United States of America) to distribute certain models of vehicles produced by Subsidiary F and to provide after-sale services as well as brand, marketing, and public relations for such vehicles. Historically, Company conducted its value-added telecommunication services operation in the Chinese mainland through the Variable Interest Entity (VIE) and the VIE’s subsidiaries, with which the Wholly Foreign-Owned Enterprise (WFOE), Company’s wholly owned subsidiary, the VIE, and the VIE’s nominee equity holders entered into certain contractual arrangements (“VIE Arrangements”). Since early 2023, Company Group has implemented a series of transactions to restructure its organization and business operations (the “Restructuring”). Company views the manufacturers and suppliers it collaborates with as key partners throughout the vehicle development process. Company aims to leverage its partners’ industry expertise to ensure that each vehicle produced meets the company's strict quality standards. Company's collaboration with Counterparty A has established a strategic collaborative relationship with its major shareholder, Counterparty A, and its asset-light business model is supported by the Counterparty A ecosystem partners. Company expects its relationship with Counterparty A to allow the company to bring its vehicles to the market at an accelerated pace by leveraging Counterparty A’s manufacturing capacity, bargaining power in procurement and supply chain, capital investment, and operational support. Company entered into a manufacturing arrangement with Counterparty A for the manufacture of its vehicles for 10 years starting from 2022. Pursuant to the manufacturing agreement, Company commissioned Counterparty A for vehicle production and authorized Counterparty A to access its technologies for the production of such models. Company is mainly responsible for the design and development of the models, designation of suppliers, product announcement, and ensuring consistency with global standards of the Company brand. Company (“the Company”), an exempted company with limited liability, was incorporated in the Cayman Islands on August 9, 2021. The Company, through its wholly owned subsidiaries, consolidated variable interest entity (“VIE”) and VIE’s subsidiaries (collectively, “the Group”), is primarily engaged in the design, development, and sale of luxury battery electric lifestyle vehicles (“BEV lifestyle models”) under the “Company” brand (“Company BEV business”). The Group is also a distributor that sells luxury sports cars under the “Company” brand (“Company sports car business”) across the world. Additionally, the Group provides other sales and ancillary services to customers. On February 22, 2024 (the “Closing Date”), Company consummated its merger with Counterparty A pursuant to a merger agreement dated January 31, 2023 (as amended and restated dated as of October 11, 2023, the “Merger Agreement”) by and among Counterparty A, Company, a Cayman Islands exempted company, Subsidiary A, a Cayman Islands exempted company and wholly-owned subsidiary of Company (“Merger Sub 1”), and Subsidiary B, a Cayman Islands exempted company and wholly-owned subsidiary of Company (“Merger Sub 2”). Company's ability to successfully operate its Global Commercial Platform will affect its ability to increase revenues. Company has taken steps to diversify its revenue sources, for example, by entering into the Distribution Agreement with Subsidiary A, pursuant to which Company is the exclusive global distributor (excluding the U.S., where Subsidiary B will act as the head distributor with the existing regional distributor continuing its functions) for Subsidiary A to distribute Subsidiary A vehicles, parts, and certain tools, and to provide aftersales services, branding, marketing, and public relations for such vehicles, parts, and tools distributed by Company. As of December 31, 2023, Company had 215 stores in its global distribution network. Major vehicle models currently in Company's global sales and distribution network include Model A, Model B, and future battery electric vehicle models, as well as certain sports car models that were or will be developed and manufactured by Subsidiary A, such as Model C (battery electric vehicle sports car) and Model D (internal combustion engine sports car). Company is a pioneering luxury battery electric vehicle (BEV) maker that designs and develops luxury lifestyle vehicles (non-sports car vehicles for daily usage) under the iconic British brand “Company” and sells all Company-branded cars. With over seven decades of racing heritage and proven leadership in the automotive industry, the Company brand symbolizes market-leading standards in performance, design, and engineering. Fusing proprietary next-generation technology built on world-class research and development capabilities and an asset-light model empowered by Counterparty A, Company is breaking new ground in electrification, digitization, and intelligence. The Company brand was founded in the U.K. in 1948 and has since established itself as a high-performance sports car brand with innovative engineering and cutting-edge technologies, renowned for its superior aerodynamics and lightweight design. The Company brand was born out of legendary success on the racetrack, including 13 FIA Formula 1 world titles and many other championship honors. In 2017, Counterparty A acquired a 51% stake in Subsidiary A and further positioned the company as a luxury lifestyle battery electric vehicle (BEV) maker. Company. (“the Company”), an exempted company with limited liability, was incorporated in the Cayman Islands on August 9, 2021. The Company, through its wholly owned subsidiaries, consolidated variable interest entity (“VIE”) and VIE’s subsidiaries (collectively, “the Group”), is primarily engaged in the design, development, and sale of luxury battery electric lifestyle vehicles (“BEV lifestyle models”) under the “Company” brand (“Company BEV business”). The Group is also a distributor that sells luxury sports cars under the “Company” brand (“Company sports car business”) across the world. Additionally, the Group provides other sales and ancillary services to customers. Company is a leading global intelligent and luxury mobility provider that designs and develops luxury lifestyle vehicles (non-sports car vehicles for daily usage) under the iconic British brand “Company” and sells all Company-branded cars. With over seven decades of racing heritage and proven leadership in the automotive industry, the Company brand symbolizes market-leading standards in performance, design, and engineering. Fusing proprietary next-generation technology built on world-class research and development capabilities and an asset-light model empowered by Counterparty A, Company is breaking new ground in electrification, digitization, and intelligence. The Company brand was founded in the U.K. in 1948 and has since established itself as a high-performance sports car brand with innovative engineering and cutting-edge technologies, renowned for its superior aerodynamics and lightweight design. The Company brand was born out of legendary success on the racetrack, including 13 FIA Formula 1 world titles and many other championship honors. In 2017, Counterparty A acquired a 51% stake in Subsidiary A and further positioned the company as a luxury lifestyle battery electric vehicle (BEV) maker. If Company is unable to maintain collaboration with Counterparty A, the company's financial performance would be directly and adversely affected. There can be no assurance that in such an event, Company would be able to partner with other third parties to meet its needs on acceptable terms or at all. The expense and time required to complete any transition, and to ensure that vehicles manufactured at facilities of new third-party partners comply with Company's quality standards and regulatory requirements, may be greater than anticipated. Any of the foregoing could adversely affect Company's business, results of operations, financial condition, and prospects. Furthermore, Company's supply chain efficiency also relies heavily on Counterparty A, largely attributable to Counterparty A's bargaining power derived from its volume and reputation. Failure to maintain agreements or partnerships with Counterparty A could adversely affect Company's relationships with suppliers, and there is no assurance that in such an event Company would be able to maintain relationships with current suppliers or secure new suppliers to meet its needs on comparable and acceptable terms. Many of Company's current and potential competitors, particularly international competitors, have significantly greater financial, technical, manufacturing, marketing, and other resources than Company does and may be able to devote greater resources to the design, development, manufacturing, distribution, promotion, sale, and support of their products. Company expects competition in the automotive industry to intensify in the future in light of increased demand and regulatory push for alternative fuel vehicles, continuing globalization, and consolidation in the worldwide automotive industry. Factors affecting competition include, among others, local protectionism, brand recognition, product quality and performance, technological innovation, product design and styling, pricing, safety, and customer service. Increased competition may lead to lower vehicle unit sales and increased inventory, which may adversely affect Company's business, financial condition, operating results, and prospects. The company's ability to successfully overcome the industry barriers and compete in its market will be fundamental to its future success in existing and new markets and its market share. There can be no assurance that Company will be able to successfully overcome the industry barriers and compete in its markets. The Reorganization consists of transferring the Company Battery Electric Vehicle (BEV) business to the Group. Before and after the Reorganization, the Company BEV business was ultimately controlled by Person A. Accordingly, the Reorganization is accounted for under common control transaction. Therefore, the accompanying consolidated and combined financial statements include the assets, liabilities, revenue, expenses, and cash flows of the Company BEV business for the periods presented and are prepared as if the corporate structure of the Group after the Reorganization had been in existence throughout the periods presented. As mentioned in note 21, on January 31, 2023, the Group entered into a distribution agreement with Subsidiary B (“Subsidiary F”), a wholly owned subsidiary of Subsidiary D and ultimately controlled by the Controlling Shareholder of the Company, pursuant to which the Group was appointed as the exclusive global distributor (excluding in the United States of America) to distribute certain models of vehicles produced by Subsidiary F and to provide after-sale services as well as brand, marketing, and public relations for such vehicles. These related party agreements include the Technology License Agreement, the Manufacture Cooperation Agreement, and the Supply of Framework Agreement, among other areas. These agreements are described in more detail in this prospectus under “Certain Relationships and Related Person Transactions   —   Related Party Transactions.” These partnerships permit Company to benefit from Counterparty A’s decades of experience investing in established automakers while focusing its efforts on core areas of differentiation, such as design, research and development, performance, and rapid adoption of the latest technologies and sustainability solutions. Company intends to continue to rely on its partnership with Counterparty A as part of its strategy. Collaboration with Counterparty A for research and development, procurement, manufacturing, and engineering is subject to risks with respect to operations that are outside of Company's control. Company currently relies on and expects to continue to rely on its strategic partner, Counterparty A, in terms of research and development, procurement, manufacturing, and engineering with regard to its vehicles. There is a risk of potential disputes with Counterparty A, and Company could be affected by adverse publicity related to Counterparty A whether or not such publicity is related to their collaboration. Company's ability to successfully build a luxury lifestyle vehicle brand could also be adversely affected by perceptions about the quality of Counterparty A’s vehicles. In addition, although Company is involved in each step of the supply chain and manufacturing process, given that Company also relies on Counterparty A to meet its quality standards, there can be no assurance that Company will successfully maintain quality standards. If Company is unable to maintain collaboration and partnership with Counterparty A, Company may be unable to enter into new agreements with third-party manufacturing partners on terms and conditions acceptable to the company or at all. The company's ability to operate as a standalone business, produce vehicles, reach development and production targets, or focus efforts on core areas of differentiation could be materially and adversely affected. Additionally, Company generated a portion of revenue from automotive design and development services provided to Counterparty A. Since Company is not the owner of the trademarks in the “Company” brand, Company depends on the ability of Subsidiary C to obtain, maintain, and enforce such trademarks in the “Company” brand. While Company is able to request that Subsidiary C file additional, similar trademark applications to those that are currently licensed, Subsidiary C may determine not to pursue such applications. Furthermore, Subsidiary C may determine not to adequately protect or pursue litigation against other companies or may pursue such litigation less aggressively than Company would. Additionally, Subsidiary C may allege that Company has breached the license agreement with them and accordingly seek to terminate the license, which could adversely affect Company's competitive business position and harm its business prospects. Licensing of trademarks involves complex legal and business issues. Disputes may arise regarding trademarks subject to such licensing agreements, including (i) the scope of rights granted under such licensing agreements and other interpretation-related issues; and (ii) Company's diligence obligations under the licensing agreements and what activities satisfy those diligence obligations. Company develops battery electric vehicles (BEVs) and technologies through cutting-edge design, research and development, and sustainable choices. Company has a dedicated global team in the U.K., Germany, and China to conduct its research and development activities, such as developing electric powertrain architecture (EPA), intelligent driving systems, aerodynamics, and cloud services, among others, supported by a strong portfolio of intellectual properties. The company's major research and development efforts are centered on architecture and chassis platforms, intelligent driving, e-mobility platforms, cabin and connectivity, and engineering design. As of December 31, 2023, Company had 1,802 research and development employees, which accounted for 56.7% of its total number of employees. Company believes that continued investments in technologies are critical to establishing market share, attracting new customers, and becoming a profitable global BEV developer. Company's core values, which include developing high-quality electric vehicles while operating with integrity, are an important component of the company's brand image, making its reputation sensitive to allegations of unethical business practices. Company does not control its independent suppliers or their business practices. Accordingly, the company cannot guarantee these suppliers' compliance with ethical business practices, such as environmental responsibilities, fair wage practices, and compliance with child labor laws, among others. A lack of demonstrated compliance could lead Company to seek alternative suppliers, which could increase costs and result in delayed delivery of its products, product shortages, or other disruptions of its operations. Violation of labor or other laws by Company's suppliers or the divergence of an independent supplier’s labor or other practices from those generally accepted as ethical in the markets in which Company operates could also attract negative publicity for Company and its brand. This could diminish the value of Company's brand image and reduce demand for its electric vehicles. If Company, or other manufacturers in the industry, encounter similar problems in the future, it could harm Company's brand image, business, prospects, results of operations, and financial condition. Pursuant to the Merger Agreement, (i) Merger Sub 1 was merged with and into LCAA (the “First Merger”), with LCAA surviving the First Merger as a wholly-owned subsidiary of Company (such company, as the surviving entity of the First Merger, “Surviving Entity 1”) and the shareholders of LCAA becoming shareholders of Company, and (ii) immediately following the First Merger and as part of the same overall transaction as the First Merger, Surviving Entity 1 was merged with and into Merger Sub 2 (the “Second Merger,” and together with the First Merger, the “Mergers”), with Merger Sub 2 surviving the Second Merger as a wholly-owned subsidiary of Company (such company, as the surviving entity of the Second Merger, “Surviving Entity 2”) (collectively, the “Merger Transaction” or “Business Combination”). The cost of renewal in each jurisdiction is different, and the Company believes the amount of renewal costs is insignificant relative to the future cash flows from sales of lifestyle vehicles under the “Company” brand. Therefore, the useful lives of the trademark licenses are considered to be indefinite. The trademark licenses were initially recognized at the amount of US$116,041 as of November 4, 2021, which is the same as the carrying amount from the perspective of the entity under common control, and their estimated fair value was determined using the relief from royalty method. The Group has entered into various non-cancellable operating agreements for land use rights, certain office spaces, warehouses, retail and service locations, and vehicles worldwide. The Group determines if an arrangement is a lease, or contains a lease, at inception and records the leases in the financial statements upon lease commencement, which is the date when the underlying asset is made available for use by the lessor. There is no assurance that Company's vehicles will maintain and strengthen a reputation comparable to that of Company’s sports vehicle segment. If Company fails to do so, it may lose the opportunity to build a critical mass of customers. Promoting and positioning the brand will likely depend significantly on Company's ability to provide high-quality vehicles and services and engage with customers as intended, and Company has limited experience in these areas. In addition, Company expects that its ability to develop, maintain, and strengthen the brand will depend heavily on the success of its branding efforts. Company markets the brand through media, word-of-mouth, events, and advertising. Such efforts may not achieve the desired results. If Company does not maintain and strengthen a strong brand, its business, financial condition, results of operations, and prospects will be materially and adversely affected. The trademark licenses granted to Company to use the “Company” brand are on a royalty-free and worldwide basis and are for use of the trademarks (i) exclusively (subject to any existing licenses already granted) for lifestyle vehicles and parts and components in relation thereto that Company designs, develops, manufactures, assembles, distributes, and sells; Company also provides Counterparty A with the intellectual properties necessary for vehicle production. Counterparty A is mainly responsible for the ordering and inspection of raw materials, production planning, production quality control, logistics and transportation of manufactured vehicles, and construction and operation of the manufacturing plant. Particularly, quality control is carried out in accordance with Company's quality assurance framework and approved by Counterparty A. In addition, Counterparty A is responsible for obtaining certificates for the manufactured vehicles. Company is a leading global intelligent and luxury mobility provider that designs and develops luxury lifestyle vehicles (non-sports car vehicles for daily usage) under the iconic British brand “Company” and sells all Company-branded cars. With over seven decades of racing heritage and proven leadership in the automotive industry, the Company brand symbolizes market-leading standards in performance, design, and engineering. Fusing proprietary next-generation technology built on world-class research and development capabilities and an asset-light model empowered by Counterparty A, Company is breaking new ground in electrification, digitization, and intelligence. The Company brand was founded in the U.K. in 1948 and has since established itself as a high-performance luxury vehicle brand with innovative engineering and cutting-edge technologies, renowned for its superior aerodynamics and lightweight design. The Company brand was born out of legendary success on the racetrack, including 13 FIA Formula 1 world titles and many other championship honors. In 2017, Counterparty A acquired a 51% stake in Company and further positioned the company as a luxury lifestyle battery electric vehicle (BEV) manufacturer. There is a risk of potential disputes with Counterparty A, and Company could be affected by adverse publicity related to Counterparty A whether or not such publicity is related to their collaboration. Company's ability to successfully build a luxury lifestyle vehicle brand could also be adversely affected by perceptions about the quality of Counterparty A’s vehicles. In addition, although Company is involved in each step of the supply chain and manufacturing process, given that Company also relies on Counterparty A to meet its quality standards, there can no assurance that Company will successfully maintain quality standards. If Company is unable to maintain collaboration and partnership with Counterparty A, Company may be unable to enter into new agreements with third-party manufacturing partners on terms and conditions acceptable to Company or at all. Company's ability to operate as a standalone business, produce vehicles, reach development and production targets, or focus efforts on core areas of differentiation could be materially and adversely affected. Additionally, Company generated a portion of revenue from automotive design and development services provided to Counterparty A. Company's future profitability depends on its ability to develop its vehicles in a cost-effective manner. As part of the development process, Company's vehicles use a wide variety of components, raw materials, and other supplies. Company expects that its cost of sales will be affected primarily by its production volume. The cost of sales will also be affected by fluctuations in certain raw material prices, although Company typically seeks to manage these costs and minimize their volatility through its supply of framework agreements with its suppliers. In addition, Company's results of operations are further affected by its ability to maintain and improve its operating efficiency, as measured by total operating expenses as a percentage of revenues. This is important to the success of the business and the prospect of gradually achieving profitability. As the business grows, Company expects to improve its operating efficiency and achieve economies of scale. Competition Company faces competition from both traditional luxury automotive developers and an increasing number of newer companies focused on electric and other alternative fuel vehicles. Company believes the primary competitive factors on which Company competes with its peers include, but are not limited to: ● brand recognition, prestige, and heritage; ● design, styling, and luxury; ● technological innovation; ● driver experience; ● product quality and performance; ● product reliability and safety; ● battery range, efficiency, and charging speeds; ● customer service and customer experience, including access to charging options and availability and terms of aftersales services; ● product pricing; ● management team experience in bringing electric vehicles and other disruptive technologies to market; ● manufacturing efficiency; ● environmental impact and perception; ● the degree and sophistication of related vehicle software. Company believes that the company is favorably positioned to compete on the basis of these factors. However, many of Company's current and potential competitors have substantially greater financial, technical, manufacturing, marketing, and other resources than the company. These competitors may be able to deploy greater resources to the design, development, manufacturing, distribution, promotion, sales, marketing, and support of their products. Sales of goods. Company generates revenues by providing the following products:  
● Battery Electric Vehicle (BEV) lifestyle models developed by Company;  
● Company-brand sports cars developed by Subsidiary B;  
● auto parts; and  
● peripheral products. Services. Company generates revenues mainly by providing automotive design and development services to OEM customers and after-sales service. The following table sets forth a breakdown of revenues by type both in absolute amount and as a percentage of Company's revenues for the years indicated.