Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

The Board of Directors of Venus Acquisition Corporation, a Cayman Islands exempt company has unanimously approved the transaction (collectively, the “Business Combination”) contemplated by that certain Merger Agreement dated as of June 10, 2021, as amended (“Business Combination Agreement” or “Merger Agreement”) by and among Venus Acquisition Corporation (“Venus”), Venus Acquisition Merger Subsidiary Inc. (“Venus Merger Sub”), a Cayman Islands exempted company formed for the purpose of effectuating the Business Combination, VIYI Algorithm Inc. (“VIYI”), a Cayman Islands exempted company, and WiMi Hologram Cloud Inc. (“WiMi” or the “Majority Shareholder”), a Cayman Islands exempted company and the legal and beneficial owner of 73% of the issued and outstanding voting securities of VIYI. As used in this proxy statement, “New Venus” refers to Venus after giving effect to the consummation of the Business Combination. As the Majority Shareholder, WiMi will effectively control New Venus after the Business Combination by holding 63.32% of the voting power of the issued and outstanding ordinary shares of New Venus. As a result, New Venus will be a “controlled company” within the meaning of the applicable Nasdaq Stock Market (“Nasdaq”) listing rules and may qualify for exemptions from certain corporate governance requirements of Nasdaq.

A copy of the Business Combination Agreement without exhibits is attached to this Proxy Statement as Annex A. After giving effect to the consummation of the Business Combination, assuming shareholder approval, Venus will be renamed to “MicroAlgo Inc.”

Pursuant to the Business Combination Agreement, VIYI will merge with Venus Merger Sub and VIYI will survive the merger as a wholly-owned subsidiary of Venus and continue its business operations through its subsidiaries. At the Effective Time of the Business Combination, the current shareholders of VIYI, including its Majority Shareholder, will receive an aggregate of 39,603,961 Venus ordinary shares equal to approximately 85.84% of the post transaction ordinary shares issued and outstanding of Venus, (i) assuming that none of the current shareholders of Venus elect to redeem the ordinary shares; (ii) excluding shares underlying the warrants issued by Venus in its initial public offering completed on February 11, 2021 (“IPO”); and (iii) giving effect to the conversion of Venus Rights issued in its IPO and private placement into 482,500 ordinary shares. The time that the Business Combination becomes effective is referred to as the “Effective Time.”

VIYI is not an operating company in the PRC but a Cayman Islands holding company with its operations conducted through its subsidiaries. Historically VIYI had a series of contractual arrangements with Shenzhen Yitian, a PRC company that functioned as a variable interest entity and is referred to as “the VIE” or “Yitian” in this proxy statement. Prior to April 1, 2022, VIYI did not own any equity interest in Shenzhen Yitian, instead, VIYI controlled and received the economic benefits of Shenzhen Yitian’s business operations through certain contractual arrangements. VIYI was the primary beneficiary and accordingly, under U.S. GAAP, the financial results of the VIE were consolidated in VIYI’s financial statements. The VIE structure provides contractual exposure to foreign investment in the VIE rather than replicating an investment and you will not and may never have direct ownership in the VIE.

Shenzhen Yitian and its subsidiary used to provide Internet information consulting services which required the possession of the Internet Content Provision (“ICP”) licenses and were subject to foreign investment restrictions under relevant PRC laws and regulations. Due to subsequent business strategy adjustment, Shenzhen Yitian and its subsidiary have terminated such Internet information consulting services since March 1, 2022. As a result of the termination of such services, Shenzhen Yitian and its subsidiary were later notified by relevant PRC government authority that the ICP licenses were no longer required and their business was no longer subject to foreign investment restrictions, therefore VIYI can own direct equity interest in Shenzhen Yitian and its subsidiaries. On April 1, 2022, VIYI and Shenzhen Yitian terminated the VIE arrangements and, as a result, VIYI’s WFOE holds 100% of the issued and outstanding shares of Shenzhen Yitian. VIYI now controls and receives the economic benefits of Shenzhen Yitian and its subsidiaries through equity ownership.

After the completion of the Business Combination, VIYI will continue conducting its business operations through its subsidiaries. In addition, VIYI is subject to legal and operational risks associated with having the majority of operations in China, including risks related to the legal, political and economic policies of the Chinese government, the relations between China and the United States, and changes in Chinese laws and regulations, which could result in a material change in VIYI’s operations and/or cause the value of VIYI’s ordinary shares to significantly decline or become worthless and affect VIYI’s ability to offer or continue to offer securities to investors.

The PRC government has authority to exert political and economic influence on the ability of a company with operations in mainland China and Hong Kong to conduct business, accept foreign investment or list on the U.S. or other foreign exchanges. In light of the recent statements and regulatory actions by the PRC government, such as those related to data security, and anti-monopoly concerns, VIYI may be subject to the risks of the uncertainty of any future actions of the PRC government in this regard, which may result in a material change in VIYI’s operations, including the ability of VIYI to carry on its current business or accept foreign investments, and the resulting adverse change in value to New Venus’ ordinary shares. As of the date of this Proxy Statement, the three Hong Kong subsidiaries of VIYI do not have any material operation in Hong Kong and they have not collected, stored, or managed any personal information in Hong Kong. Therefore, VIYI has concluded that currently it does not expect that laws and regulations in Mainland China on data security, data protection, cybersecurity or anti-monopoly to be applied to its Hong Kong subsidiaries or that the oversight of the Cyberspace Administration of China will be extended to its operations outside of Mainland China. VIYI may also be subject to penalties and sanctions imposed by the PRC regulatory agencies, including the Chinese Securities Regulatory Commission (“CSRC”), if it fails to comply with such rules and regulations, which could adversely affect the ability of New Venus to continue to be listed for trading on Nasdaq or another foreign exchange, which may cause the value of New Venus securities to significantly decline or become worthless.

The Holding Foreign Companies Accountable Act (the “HFCA Act”) and related regulations call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors and could add uncertainties to VIYI’s offering that trading in VIYI’s securities may be prohibited under the HFCA Act. Pursuant to the HFCA Act, the Public Company Accounting Oversight Board (United States) (the “PCAOB”) issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in (1) mainland China of the PRC because of a position taken by one or more authorities in mainland China and (2) Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB’s report identified the specific registered public accounting firms which are subject to these determinations. On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the “AHFCAA”). The bill, if enacted, would shorten the three-consecutive-year compliance period under the HFCA Act to two consecutive years. As a result, the time period before VIYI’s securities may be prohibited from trading or delisted will be reduced. On August 26, 2022, the PCAOB signed a Statement of Protocol (“SOP”) with the China Securities Regulatory Commission and the Ministry of Finance of PRC, taking the first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong completely, consistent with U.S law. Pursuant to the SOP, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. However, uncertainties still exist as to whether the applicable parties, including governmental agencies, will fully comply with the framework. Depending on the implementation of the SOP, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered public accounting firms in China, then China-based companies will be delisted pursuant to the HFCA Act despite the SOP. Therefore, there is no assurance that the SOP could give relief to China-based companies against the delisting risk from the application of the HFCA Act or AHFCAA. Currently, VIYI’s auditor is headquartered in New York and has been inspected by the PCAOB on a regular basis. Therefore, it is not subject to the determinations announced by the PCAOB on December 16, 2021. Please refer to “Risk Factor — Risks Factors Relating to Doing Business in China — The recent joint statement by the SEC and PCAOB, proposed rule changes submitted by Nasdaq, and the Holding Foreign Companies Accountable Act all call for additional and more stringent criteria to be applied to emerging market companies, including companies based in China, upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB.” on page 57 of this proxy statement. For a detailed description of the risks facing New Venus, VIYI and the offering associated with the VIE structure, please refer to “Risk Factors — Risk Factors Relating to Doing Business in China — The PRC government exerts substantial influence over the manner in which VIYI, its subsidiaries, and the VIE must conduct its business activities. VIYI is currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if VIYI was required to obtain approval in the future and was denied permission from Chinese authorities to list on U.S. exchanges, VIYI will not be able to continue listing on U.S. exchange, which would materially affect the interest of the investors.”

For the year ended December 31, 2020, VIYI and its subsidiary in Singapore, Fe-da Electronics, had intercompany transfers in cash of approximately RMB 8.0 million (USD 1.2 million) and the VIE had intercompany transfer of approximately RMB 106 million to VIYI’s WFOE. For the year ended December 31, 2021, VIYI and VIYI Ltd. had intercompany transfers in cash of approximately RMB 16.8 million (USD 2.5 million) and VIYI’s WFOE transferred RMB 12.7 million to the VIE. From January 1, 2022 to April 1, 2022, historical VIE had intercompany transfer of approximately RMB 17.6 million to VIYI’S WFOE. For further details, please refer to “Summary Financial Information of VIYI”. There were no dividends or distribution made between or among VIYI, its subsidiaries and the historical VIE. VIYI has established controls and procedures for cash flows within its organization. Each transfer of cash between or among the Cayman Islands holding company, a subsidiary, and the historical VIE is subject to internal approvals. In general, cash is maintained in the holding company level (i.e. VIYI for companies outside of PRC and VIYI’s WFOE for companies inside PRC, respectively) for a more efficient cash management. VIYI’s PRC subsidiaries and the historical VIE generate their revenue primarily in Renminbi, which is not freely convertible into other currencies. Under VIYI’s current corporate structure and internal policy, VIYI may transfer funds to its subsidiaries via capital contributions or shareholder loans; and subsidiaries may transfer funds to VIYI via dividends or distributions. VIYI may rely on dividend payments from its PRC subsidiaries to fund any cash and financing requirements VIYI may have. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of the State Administration for Foreign Exchange, or SAFE, by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations of VIYI’s PRC subsidiaries may be used to pay dividends to VIYI. VIYI has no present plans to distribute earnings or settle amounts owed under the VIE agreements and plans to retain VIYI’s retained earnings to continue to grow VIYI’s business. No dividends or distributions have been declared to pay VIYI from its subsidiaries or the VIE affiliated entities, and no dividends or distributions have been made to any U.S. investors. For further details, please refer to “Summary of the Proxy Statement — Transfer of Cash within VIYI’s organization” and “Summary Financial Information of VIYI”.

Venus’ ordinary shares are listed on Nasdaq under the symbol “VENA”. Venus will apply for listing of the ordinary shares to be issued to the VIYI shareholders, and in connection therewith, apply for listing of the New Venus ordinary shares on the Nasdaq Capital Market (including the presently outstanding Venus ordinary shares) under a new symbol “MLGO” to reflect the change of business resulting from the Business Combination and the anticipated name change of Venus to MicroAlgo Inc. following the Business Combination. It is a condition to the consummation of the Business Combination that Venus receives confirmation from Nasdaq that New Venus has been conditionally approved for listing on the Nasdaq Capital Market following completion of the Business Combination. There can be no assurance that such listing condition will be satisfied or that Venus will receive confirmation from Nasdaq. If such listing condition is not met or if Venus does not receive confirmation, the Business Combination will not be consummated unless the parties waive the Nasdaq listing condition.

The accompanying proxy statement provides shareholders of Venus with detailed information about the Business Combination and other matters to be considered at the Extraordinary General Meeting (defined below) of Venus. We encourage you to read the entire accompanying proxy statement, including the Annexes and other documents referred to therein, carefully and in its entirety. You should also carefully consider the risk factors described in “Risk Factors” beginning on page 39 of the accompanying proxy statement.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT, PASSED UPON THE MERITS OR FAIRNESS OF THE BUSINESS COMBINATION OR RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THE ACCOMPANYING PROXY STATEMENT. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.

The accompanying Proxy Statement is dated [●], 2022
and first mailed to the shareholders of Venus Acquisition Corporation on or about [●], 2022

You are cordially invited to attend the Extraordinary General Meeting of Venus Acquisition Corporation. (“Venus,” “VENA,” “we”, “our”, or “us”), which will be held at 10:00 a.m., Eastern Time, on [●], 2022 (the “Extraordinary General Meeting”). The Extraordinary General Meeting will be a completely virtual Meeting of shareholders, which will be conducted via live webcast. You will be able to attend the Extraordinary General Meeting online, vote and submit your questions during the Extraordinary General Meeting by visiting https://www.cleartrustonline.com/venus. Venus is a blank check company incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as a “target business” (the “Business Combination”). Venus completed its initial public offering on February 11, 2021.

One of the matters you will be asked to vote on at the Extraordinary General Meeting is the approval of a merger agreement and plan of merger, dated as of June 10, 2021 (as it may be amended from time to time, the “Merger Agreement”), which provides for a Business Combination between Venus, Venus Acquisition Merger Subsidiary Inc. (“Venus Merger Sub”), a Cayman Islands exempted company formed for the purpose of effectuating the Business Combination, VIYI Algorithm Inc. (“VIYI”), a Cayman Islands exempted company, and WiMi Hologram Cloud Inc. (“WiMi” or the “Majority Shareholder”), a Cayman Islands exempted company and the legal and beneficial owner of a majority of the issued and outstanding voting securities of VIYI. Pursuant to the Merger Agreement, the Venus Merger Sub will merge with and into VIYI, with VIYI being the surviving entity and becoming a wholly owned subsidiary of Venus. For the purposes of this proxy statement, “New Venus” refers to Venus after the consummation of the Business Combination.

The aggregate consideration for the Business Combination is $400,000,000, payable to the shareholders of VIYI in the form of approximately 39,603,961 newly issued Venus ordinary shares valued at $10.10 per ordinary share.

Upon the closing of the Business Combination, the following transactions and events will also be consummated:

At the Extraordinary General Meeting, Venus shareholders will be asked to consider and vote upon the following proposals:

If the Business Combination Proposal is not approved, neither the Director Election Proposal, the Nasdaq Stock Issuance Proposal, the Share Increase Proposal, Name Change Proposal, nor the Articles Amendment Proposal will be presented to the Venus shareholders for a vote. The approval of all of the Proposals other than the Adjournment Proposal are preconditions to the closing of the Business Combination with VIYI.

It is anticipated that, upon the consummation of the Business Combination, Venus’ existing shareholders, including the Sponsor (as defined below), will own approximately 14.16% of the issued New Venus ordinary shares, and VIYI shareholders will own of approximately 85.84% of the issued New Venus ordinary shares.

Following the Business Combination, Venus will have the following securities issued and outstanding:

These relative percentages assume that (i) none of Venus’ existing public shareholders exercise their redemption rights, as discussed herein; (ii) Venus Rights are automatically converted to New Venus ordinary shares upon the consummation of the Business Combination, and (iii) there is no exercise of Venus Warrants prior to the consummation of the Business Combination. If any of Venus’ existing public shareholders exercise their redemption rights, the anticipated percentage ownership of Venus’ existing shareholders will be reduced. You should read “Summary of the Proxy Statement — The Business Combination” and “Unaudited Pro Forma Condensed Combined Financial Statements” for further information.

The Venus Units, Venus ordinary shares, Venus Rights and Venus Warrants are currently listed on the Nasdaq Capital Market under the symbols “VENAU,” “VENA,” “VENAR” and “VENAW,” respectively. New Venus intends to apply to list the New Venus ordinary shares on the Nasdaq Capital Market under the symbols “MGLO”, in connection with the closing of the Business Combination. Venus cannot assure you that the New Venus ordinary shares will be approved for listing on Nasdaq Capital Market.

Investing in New Venus securities involves a high degree of risk. See “Risk Factors” beginning on page 39 for a discussion of information that should be considered in connection with an investment in New Venus securities.

As of June 30, 2022, there was approximately $47,306,580 in Venus’ trust account. On June 30, 2022, the closing price of Venus ordinary shares was $10.22. As of August 24, 2022, the closing price was $10.34 per ordinary share.

Pursuant to Venus’ amended and restated articles of association, Venus is providing its public shareholders with the opportunity to redeem all or a portion of their shares of Venus ordinary shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in Venus’ trust account as of two (2) business days prior to the consummation of the Business Combination, including interest, less taxes payable, divided by the number of then outstanding shares of Venus ordinary shares that were sold in Venus’ IPO. Venus estimates that the per-share price at which public shares may be redeemed from cash held in the trust account will be approximately $10.10 at the time of the Extraordinary General Meeting. Venus’ public shareholders may elect to redeem their shares even if they vote for the Business Combination or the other Proposals or do not vote at all. Venus has no specified maximum redemption threshold under the Venus’ memorandum and articles of association.

Venus is providing this proxy statement and accompanying proxy card to its shareholders in connection with the solicitation of proxies to be voted at the Extraordinary General Meeting and at any adjournments or postponements of the Extraordinary General Meeting. Only holders of Venus ordinary shares are entitled to vote on the Proposals. The Sponsor and Ladenburg Thalmann & Co Inc., which own in the aggregate approximately 23.97% of Venus ordinary shares as of the record date, have agreed to vote their respective Venus ordinary shares in favor of the Business Combination Proposal, and have indicated that they intend to vote for the Director Election Proposal, the Nasdaq Stock Issuance Proposals, the Share Increase Proposal, the Name Change Proposal, the Articles Amendment Proposal and the Adjournment Proposal, although there is no agreement in place with respect to voting on those proposals. In light of the fact that the Sponsor and Ladenburg Thalmann & Co Inc., which own in the aggregate approximately 23.97% of Venus ordinary shares as of the record date, the percentage of remaining ordinary shares needed to vote for the Business Combination Proposal if only a quorum of Venus’ shares are present is any number greater that 26.03%. Each Venus shareholder’s vote is very important. Whether or not you plan to attend the Extraordinary General Meeting in person, please submit your proxy card without delay. Venus’ shareholders may revoke proxies at any time before they are voted at the meeting. Voting by proxy will not prevent a Venus shareholder from voting in person if such shareholder subsequently chooses to attend the Extraordinary General Meeting. If you are a holder of record and you attend the Extraordinary General Meeting and wish to vote in person, you may withdraw your proxy and vote in person. Assuming that a quorum is present, attending the Extraordinary General Meeting either in person or by proxy and abstaining from voting will have the same effect as voting against all the Proposals. And broker non-votes will have no effect on any of the Proposals.

If you sign, date and return your proxy card without indicating how you wish to vote, your proxy will be voted in favor of each of the Proposals presented at the Extraordinary General Meeting. If you fail to return your proxy card or fail to instruct your bank, broker or other nominee how to vote, and do not attend the Extraordinary General Meeting in person, the effect will be that your shares will not be counted for purposes of determining whether a quorum is present at the Extraordinary General Meeting of shareholders and, if a quorum is present, will have the effect of a vote against the Business Combination Proposal and no effect on the Adjournment Proposal. If you are a Venus shareholder of record and you attend the Extraordinary General Meeting and wish to vote in person, you may withdraw your proxy and vote in person.

We encourage you to read this proxy statement carefully. In particular, you should review the matters discussed under the caption “Risk Factors” beginning on page 39.

Venus board of directors has unanimously approved the Merger Agreement and the transactions contemplated therein and described elsewhere in this the Proxy Statement, and unanimously recommends that Venus shareholders vote “FOR” approval of each of the Proposals. When you consider Venus board of director’s recommendation of these Proposals, you should keep in mind that Venus’ directors and officers have interests in the Business Combination that may conflict or differ from your interests as a shareholder. See the section titled “Proposals to be Considered by Venus Shareholders: The Business Combination Proposal — Interests of Venus’ Directors and Executive Officers in the Business Combination.”

On behalf of the Venus board of directors, I thank you for your support and we look forward to the successful consummation of the Business Combination.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in the Business Combination or otherwise, or passed upon the adequacy or accuracy of this proxy statement. Any representation to the contrary is a criminal offense.

If you would like to receive additional information or if you want additional copies of this document, agreements contained in the appendices or any other documents filed by Venus with the Securities and Exchange Commission, such information is available without charge upon written or oral request. Please contact:

Advantage Proxy, Inc.
P.O. Box 13581
Des Moines, WA 98198
Toll Free Telephone: (877) 870-8565
Main Telephone: (206) 870-8565
E-mail: ksmith@advantageproxy.com

If you would like to request documents, please do so no later than one week prior to the meeting date to receive them before the Extraordinary General Meeting. Please be sure to include your complete name and address in your request. Please see the section titled “Where You Can Find Additional Information” to find out where you can find more information about Venus, Venus Merger Sub and VIYI. You should rely only on the information contained in this proxy statement in deciding how to vote on the Business Combination. Neither of Venus, New Venus, Venus Merger Sub, WiMi nor VIYI has authorized anyone to give any information or to make any representations other than those contained in this proxy statement. Do not rely upon any information or representations made outside of this proxy statement. The information contained in this proxy statement may change after the date of this proxy statement. Do not assume after the date of this proxy statement that the information contained in this proxy statement is still correct.

Unless otherwise noted, all translations from Renminbi to U.S. dollars and from U.S. dollars to Renminbi in this proxy statement were calculated at the rate of RMB 1.00 to USD 0.1568, representing the mid-point reference rate set by Peoples’ Bank of China on December 31, 2021. No representation is made that the RMB amounts represent or could have been, or could be, converted, realized or settled into USD at that rate, or at any other rate.

This document constitutes a notice of meeting and a proxy statement under Section 14(a) of the Exchange Act, with respect to the Extraordinary General Meeting at which Venus’ shareholders will be asked to consider and vote upon the Proposals to approve the Business Combination.

This proxy statement does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is not lawful to make any such offer or solicitation in such jurisdiction.

Venus files periodic report under the Securities Exchange Act of 1934, as amended with the SEC which can be found at http://www.sec.gov. After the consummation of the Business Combination, New Venus will continue to file its Annual Report on Form 10-K with the SEC no later than 90 days following its fiscal year end. You can read Venus’ SEC filings, including this proxy statement, over the Internet at the SEC’s website at http://www.sec.gov.

Information and statements contained in this proxy statement, or any annex to this proxy statement, are qualified in all respects by reference to the copy of the relevant contract or other annex filed with this proxy statement.

If you would like additional copies of this proxy statement, or if you have questions about the Business Combination, you should contact Venus’ proxy solicitor, Advantage Proxy, Inc, toll-free at +1 (877) 870-8565 or by email at ksmith@advantageproxy.com.

All information contained in this proxy statement relating to Venus and Venus Merger Sub has been supplied by Venus, and all such information relating VIYI has been supplied by VIYI. Information provided by either of Venus or VIYI does not constitute any representation, estimate or projection of the other party.

Neither Venus, New Venus, Venus Merger Sub, WiMi, nor VIYI has authorized anyone to give any information or make any representation about the Business Combination or their companies that is different from, or in addition to, that contained in this proxy statement or in any of the materials that have been incorporated into this proxy statement by reference. Therefore, if anyone does give you any such information, you should not rely on it. If you are in a jurisdiction where offers to exchange or sell, or solicitations of offers to exchange or purchase, the securities offered by this proxy statement or the solicitation of proxies is unlawful, or if you are a person to whom it is unlawful to direct these types of activities, then the offer presented in this proxy statement does not extend to you. The information contained in this proxy statement speaks only as of the date of this proxy statement unless the information specifically indicates that another date applies.

This proxy statement contains forward-looking statements, including statements about the parties’ ability to close the Business Combination, the anticipated benefits of the Business Combination, the financial conditions, results of operations, earnings outlook and prospects of New Venus, Venus and/or VIYI and may include statements for the period following the consummation of the Business Combination. Forward-looking statements appear in a number of places in this proxy statement including, without limitation, in the sections headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations of VIYI,” and “Business of VIYI.” In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “continue,” “could,” “may,” “might,” “possible,” “potential,” “predict,” “should,” “would” and other similar words and expressions, but the absence of these words does not mean that a statement is not forward-looking.

The forward-looking statements are based on the current expectations of the management of Venus and VIYI, as applicable, and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in “Risk Factors”, those discussed and identified in public filings made with the SEC by Venus and the following:

Should one or more of these risks or uncertainties materialize, or should any of the assumptions made by the management of Venus, VIYI and New Venus prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.

All subsequent written and oral forward-looking statements concerning the Business Combination or other matters addressed in this proxy statement and attributable to VIYI, Venus, New Venus or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this proxy statement. Except to the extent required by applicable law or regulation, New Venus, VIYI and Venus undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this proxy statement or to reflect the occurrence of unanticipated events.

QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION AND
THE EXTRAORDINARY GENERAL MEETING

Approval of the Business Combination Proposal, Share Increase Proposal, Director Election Proposal, Nasdaq Stock Issuance Proposal and the Adjournment Proposal require the affirmative vote of the holders of a majority of the issued and outstanding Venus ordinary shares present and entitled to vote at the Extraordinary General Meeting to be passed as ordinary resolutions. The Name Change Proposal and Articles Amendment Proposal require the affirmative vote of at least a two-thirds majority of the issued and outstanding Venus ordinary shares present and entitled to vote at the Extraordinary General Meeting to be passed as special resolutions.

Assuming that a quorum is present, attending the Extraordinary General Meeting either in person or by proxy and abstaining from voting will have the same effect as voting against the Business Combination Proposal and no effect on the other Proposals and failing to instruct your bank, brokerage firm or nominee to attend and vote your shares will have no effect on any of the Proposals.

As of the record date, 1,375,000 shares held by our Sponsor, or approximately 22.73% of the outstanding Venus ordinary shares, would be voted in favor of each of the Proposals.

As a result, in the event that the Business Combination with VIYI is not completed, and Venus is not able to consummate a business combination with any other proposed target business before November 11, 2022, to such date which Venus has determined to extend to as needed in order to close a business combination transaction subject to deposit of further monthly extension fee, the securities held by the Sponsor and other insiders of Venus will become worthless.

In August 2019, our Sponsor Yolanda Management Corporation a British Virgin Islands exempted company, purchased an aggregate of 1,150,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.02 per share. Additionally, in connection with the completion of our IPO, our Sponsor, purchased an aggregate of 225,000 units at a price of $10.00 per unit for an aggregate purchase price of $2,250,000. Each private placement unit purchased by the Sponsor consists of one ordinary share, one right to receive one-tenth (1/10) of an ordinary share upon the consummation of a business combination and one warrant. Each private placement warrant is exercisable to purchase one-half of one ordinary share at a price of $11.50 per whole share.

As a result of these purchases, our Sponsor owns an aggregate of 1,375,000 ordinary shares which were acquired at an average price of $1.65 per share. Giving effect to the conversion of the rights into ordinary shares, our Sponsor would own an aggregate of 1,397,500 shares acquired for an average acquisition price of $1.62 per share. Investors in our IPO paid an average per share price of approximately $10.00 per share, without assigning a value to the warrants and rights included in the units. Therefore, our Sponsor may earn a positive return on the ordinary shares owned by it even if the ordinary shares trade following the completion of the business combination trade below $10.00 per share and the IPO investors experience a loss on their return. The likely benefit to our Sponsor and our directors and officers may influence their motivation for promoting the Business Combination and/or soliciting proxies for the approval of the Business Combination Proposal.

None of the officers or directors, or the Sponsor of Venus, have any affiliation with VIYI.

a Cayman Islands exempted company such as Venus) outstanding before the issuance of stock or securities or the issuance of stock or securities to any director, officer or “Substantial Shareholder.” In connection with the Business Combination, Venus is seeking shareholder approval for the issuance of up to 39,603,961 Venus ordinary shares to the VIYI shareholders. Because the number of securities that New Venus will issue in connection with the Business Combination is equal to 20% or more of Venus’ outstanding voting power and outstanding Venus ordinary shares in connection with the Business Combination, it is required to obtain shareholder approval of such issuances pursuant to Nasdaq listing rules. Shareholder approval of the Nasdaq Stock Issuance Proposal is also a condition to closing the Merger Agreement. See the section entitled “The Nasdaq Stock Issuance Proposal” for additional information.

and entitled to vote at the meeting, or (ii) has properly submitted a proxy card or voting instructions through a broker, bank or custodian. In the absence of a quorum, the Extraordinary General Meeting will be adjourned to the same time and place seven days hence, or to such other time or place as is determined by the directors.

Our Sponsor, officers and directors have agreed (and their permitted transferees will agree), pursuant to the terms of a letter agreement entered into with us at the time of consummation of our IPO, to vote any founder shares and private placement shares held by them and any public shares purchased during or after this offering in favor of our business combination. As a result, in addition to our shareholder’s founder shares, we would need only 1,575,001, or approximately 34.24%, of the 4,600,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted in order to have our business combination approved (assuming the over-allotment option is exercised). Further, in connection with our IPO, we issued 75,000 ordinary shares to Ladenburg Thalmann & Co., Inc, our lead underwriter.

In light of the fact that the Sponsor and Ladenburg Thalmann & Co Inc., which own in the aggregate approximately 23.97% of Venus ordinary shares as of the record date have agreed to vote their shares in favor of the Business Combination Proposal, the percentage of remaining shares needed to vote for the business combination proposal if only a quorum of Venus’ shares are present is any number greater that 26.03%.

listed at the end of this section and deliver your shares to Venus’ transfer agent (physically, or electronically using the DWAC (Deposit/Withdrawal At Custodian) system) at least two (2) business days prior to the vote at the Extraordinary General Meeting. You are not required to vote for or against the Business Combination or any other Proposal in order to redeem your Venus ordinary shares.

Any corrected or changed written demand of redemption rights must be received by Venus’ transfer agent two business days prior to the Extraordinary General Meeting. No demand for redemption will be honored unless the holder’s shares have been delivered (either physically or electronically) to the transfer agent at least two business days prior to the vote at the Extraordinary General Meeting.

Public shareholders may seek to have their shares redeemed regardless of whether they vote for or against the Business Combination and whether or not they are holders of Venus ordinary shares as of the record date. Any public shareholder who holds Venus ordinary shares on or before [●] (two (2) business days before the Extraordinary General Meeting) will have the right to demand that his, her or its shares be redeemed for a pro rata share of the aggregate amount then on deposit in the trust account, less any taxes then due but not yet paid, at the consummation of the Business Combination. If you have questions regarding the certification of your position or delivery of your shares, please contact:

in person or by proxy and abstaining from voting will have the same effect as voting against the Business Combination Proposal and no effect on the other Proposals and failing to instruct your bank, brokerage firm or nominee to attend and vote your shares will have no effect on any of the Proposals.

If you are the purchaser of Venus ordinary shares after the record date, you must either (i) have a written agreement from the seller or transferor of the Venus ordinary shares whereby the seller/transferor agrees to vote the Venus ordinary shares in accordance with your instructions, or (ii) obtain a proxy from the seller/transferor which authorizes you to vote the Venus ordinary shares held in record name of the seller/transferor.

Even if you elect to redeem your Ordinary Shares and the Business Combination is completed, you will still own the Venus Rights and Venus Warrants. Based on the closing price of Venus Warrants of $0.094 on Nasdaq as of April 14, 2022, the Venus Warrants of public shareholders, Sponsor, officers and directors had an aggregate market value of approximately $453,550 assuming no redemptions by Venus shareholders and $21,150, assuming redemptions of 4,600,000 ordinary shares for cash ($46.5 million in the aggregate). The $46.5 million, or 4,600,000 ordinary shares, represents the maximum redemption amount. If the Business Combination with VIYI is not completed, and we cannot source and complete a substitute business combination within the time frame set forth in our constitutive documents, the Public Warrants and Rights will expire and will be worthless.

After the Business Combination, assuming there are no redemptions of Venus’ shares and giving effect to (i) the issuance of the 39,603,961 Ordinary Shares in the Acquisition Merger, issued to the current VIYI shareholders; (ii) an aggregate of 482,500 shares are issued upon conversion of the Venus Rights, including private rights; (iii) an aggregate of 2,412,500 shares are issued upon conversion of the Venus Warrants, including private warrants; and (iv) an aggregate of 75,000 Ordinary shares are issued to Ladenburg as underwriter in our IPO, Venus’ current public shareholders will own approximately 15.16% of the issued share capital of Venus, Venus’ current directors, officers and affiliates will own approximately 3.11% of the issued share capital of Venus, and VIYI shareholders will own approximately 81.58% of the issued share capital of New Venus.

Assuming the maximum number of Venus’ shareholders elect to redeem their ordinary shares (an aggregate of 4,600,000 ordinary shares) the Venus’ public shareholders who hold shares issued in the IPO will own approximately 6.28% of Venus’ issued and outstanding shares of ordinary shares after giving effect to (i) the issuance of the 39,603,961 Ordinary Shares in the Acquisition Merger, issued to the current VIYI shareholders and (ii) an aggregate of 482,500 shares are issued upon conversion of the Venus Rights, including private rights; (iii) an aggregate of 2,412,500 shares are issued upon conversion of the Venus Warrants, including private warrants; and (iv) an aggregate of 75,000 Ordinary Shares issued to Ladenburg Thalmann as underwriter in our IPO. VIYI shareholders will own approximately 90.11% of the issued share capital of New Venus.

The board of Venus has resolved to extend the period of time up to nine times to complete the business combination with VIYI. Venus has made seven monthly extensions and paid the monthly extension fee to extend the time to complete the transaction to September 11, 2022. Venus plans to deposit further monthly extension fee of $153,333 per month to the trust account up to nine times up to November 11, 2022 to further extend the period of time to consummate a business combination with VIYI.

You may also obtain additional information about Venus from documents filed with the SEC by following the instructions in the section titled “Where You Can Find More Information.”

Pursuant to the rules of the SEC, Venus and vendors that it employs to deliver communications to its shareholders are permitted to deliver to two or more shareholders sharing the same address a single copy of this proxy statement, unless Venus has received contrary instructions from one or more of such shareholders. Upon written or oral request, Venus will deliver a separate copy of this proxy statement to any shareholder at a shared address to which a single copy of this proxy statement was delivered and who wishes to receive separate copies in the future. Shareholders receiving multiple copies of the proxy statement may likewise request that Venus delivers single copies of this proxy statement in the future. Shareholders may notify Venus of their requests by contacting:

SUMMARY OF THE PROXY STATEMENT

This summary highlights selected information from this proxy statement but may not contain all of the information that may be important to you. Accordingly, you are encouraged to read carefully this entire proxy statement, including the Merger Agreement attached as Annex A and the Venus’ Memorandum and Articles of Association attached as Annex B. Please read these documents carefully as they are the legal documents that govern the Business Combination and your rights in the Business Combination.

Unless otherwise specified, all share calculations assume no exercise of the redemption rights by Venus’ shareholders.

The Parties to the Business Combination

Venus Acquisition Corporation

Venus is a blank check company incorporated in the Cayman Islands which was formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements with, or engaging in any other similar business combination with one or more businesses or entities. Although Venus’ efforts in identifying prospective target businesses will not be limited to a particular geographic region, it intends to focus on businesses that have a connection to the Asian market. Venus believes that it will add value to these businesses primarily by providing them with access to the U.S. capital markets.

Venus has 12 months from the date of Venus’ IPO (February 11, 2021) to consummate a prospective business combination. However, if Venus anticipates that it may not be able to consummate a business combination within 12 months, it may, by resolution of its board of directors extend the period of time to consummate a business combination up to nine times, each by an additional one month (for a total of up to 21 months to complete a business combination). In the event Venus does not consummate a business combination within 12 months from the closing of its IPO (or up to 21 months as previously described), it will cease operations and liquidate the trust account and distribute the funds included therein to the holders of its securities sold in its IPO and dissolve. On February 11, 2022, the Company elected to extend the date by which it is required to complete a business combination to March 11, 2022 and deposited $153,333 into its Trust Account. In the following months after March 11, 2022, the Company elected to further extend the date by which it is required to complete a business combination to September 11, 2022 and the extension fee has been deposited. The Sponsor intends to extend the life of Venus till the consummation of the business combination with VIYI or November 11, 2022 which is earlier.

On February 11, 2021, Venus consummated the IPO of 4,000,000 units, at $10.00 per unit. In addition, Venus’ underwriters exercised in full the over-allotment option for an additional 600,000 units on the same date, resulting in the issuance and sale of an aggregate of 4,600,000 units, generating gross proceeds of $46,000,000. In addition, Venus sold to Ladenburg Thalmann & Co., Inc. a total of 75,000 Venus ordinary shares for $75.

Simultaneously with the closing of the IPO, Venus consummated a private placement with its Sponsor, Yolanda Management Corporation, for the purchase of 225,000 Units (the “Private Units”) at a price of $10.00 per Private Unit, generating total proceeds of $2,250,000. The Sponsor has also previously loaned Venus the sum of $289,000, which loan was payable upon the earlier of completion of the IPO or December 31, 2021. In connection with the completion of the IPO, the Sponsor instructed Venus to offset payment of the note with a corresponding portion of the subscription price for the Private Unit purchase.

After deducting the underwriting discounts, the pre-IPO Sponsor loan, offering expenses, and commissions from the IPO and the sale of the Private Units, a total of $46,460,000 was deposited into a trust account established for the benefit of Venus’ public shareholders with Wilmington Trust, National Association acting as trustee, at an account at Morgan Stanley, and the remaining proceeds became available to be used to provide for business, legal and accounting due diligence on prospective business combinations and continuing general and administrative expenses.

As of [●], 2022, Venus has approximately $[●] of unused net proceeds that were not deposited into the trust account to pay future general and administrative expenses. The net proceeds deposited into the trust account remain on deposit in the trust account earning interest. As of April 14, 2022, there was $46,932,997 held in the trust account (including $472,997 of accrued interest which Venus can withdraw to pay taxes).

Venus’ units, ordinary shares, warrants and rights are each quoted on the Nasdaq Capital Market, under the symbols “VENAU,” “VENA,” “VENAW” and “VENAR,” respectively. Each Venus Unit consists of one share

of ordinary share, one warrant entitling its holder to purchase one-half of one share of ordinary share at a price of $11.50 per whole share, and one right to receive one-tenth (1/10) of one share of ordinary share upon the consummation of the Business Combination. Venus’ units commenced trading on the Nasdaq Capital Market on February 11, 2021. Venus’ ordinary share, public rights and public warrants commenced trading on the Nasdaq Capital Market on April 9, 2021.

Since completing its initial public offering, Venus has been dedicating its management’s time and efforts to sourcing a target business. Venus has until February 11, 2022 to consummate a business combination. In addition, Venus has the option and has decided to extend the period of time to consummate a business combination up to nine times as needed, each by an additional month (for a total of 21 months) to complete a business combination (the “combination period”). In order to extend the time available for Venus to consummate a business combination, the Sponsor or its affiliate or designees must deposit into the Trust Account $153,333 (approximately $0.033 per public Ordinary Share), up to an aggregate of $1,380,000, or $0.30 per public ordinary share, on or prior to the date of the applicable deadline, for each one-month extension. The Board of Venus has resolved to extend the time to complete the transaction up to nine times to November 11, 2022. Venus has made seven monthly extensions and deposited the required extension fee to extend the time to complete the business combination to September 11, 2022. Venus plans to deposit further monthly extension fee up to nine times to extend the time to complete its business combination transaction with VIYI. The funds which have been provided to extend the time frame is in the form of loan to us from our Sponsor. The terms of any such loan are interest free and will be repayable only if Venus completes a business combination. If Venus is unable to complete a business combination within the combination period, Venus will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter, redeem 100% of the outstanding public Venus ordinary shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned (net of taxes payable and less interest to pay dissolution expenses up to $50,000), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and Venus’ board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of Venus, subject in each case to its obligations to provide for claims of creditors and the requirements of applicable law. The underwriter has agreed to waive its rights to the deferred underwriting commission held in the trust account in the event Venus does not complete a business combination within the combination period and, in such event, such amounts will be included with the funds held in the Trust Account that will be available to fund the redemption of the public Venus ordinary shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the initial public offering price per unit ($10.00).

VIYI Algorithm Inc.

VIYI is not an operating company in the PRC but a Cayman Islands holding company with its operations conducted through its subsidiaries.

Historically, VIYI had a series of contractual arrangements with Shenzhen Yitian, a PRC company that functioned as a variable interest entity and is referred to as “the VIE” or “Yitian” in this proxy statement. VIYI does not own any equity interest in Shenzhen Yitian, instead, VIYI controls and receives the economic benefits of Shenzhen Yitian’s business operations through certain contractual arrangements. Accordingly, under U.S. GAAP, the financial results of the VIE are consolidated in VIYI’s financial statements.

Due to the business strategy adjustment, Shenzhen Yitian and its subsidiaries have no longer operated the business involving foreign investment restrictions since March 1, 2022, therefore VIYI can own direct equity interest in Shenzhen Yitian and its subsidiaries. On April 1, 2022, VIYI and Shenzhen Yitian have terminated the VIE arrangements and, as a result, VIYI’s WFOE holds 100% of the issued and outstanding shares of Shenzhen Yitian. VIYI now controls and receives the economic benefits of Shenzhen Yitian and its subsidiaries through equity ownership.

As a holding company with no material operations of its own, VIYI conducts substantially all of its operations through its subsidiaries.

VIYI is dedicated to the development and application of bespoke central processing algorithms. VIYI provides comprehensive solutions to customers by integrating central processing algorithms with software or hardware, or both, thereby helping them to increase the number of customers, improve end-user satisfaction, achieve direct cost savings, reduce power consumption, and achieve technical goals. The range of VIYI’s services includes algorithm optimization, accelerating computing power without the need for hardware upgrades, lightweight data processing, and data intelligence services. VIYI’s ability to efficiently deliver software and hardware optimization to customers through bespoke central processing algorithms serves as a driving force for VIYI’s long-term development.

Currently, VIYI is focused on developing and delivering central processing algorithm solutions to customers engaged in internet advertisement and gaming, and intelligent chips. Moreover, VIYI’s customer base is rapidly growing due to a general demand for more efficient data processing in various industries driven by the growing internet population and prevalence of AI. According to the CIC Report, revenue of central processing algorithm services derived from internet advertisement and online gaming alone grew from RMB 2.2 billion in 2016 to RMB 6.9 billion in 2020, representing a CAGR of 32.7%. This market is expected to maintain a rapid growth trend, expanding at a CAGR of 15% during the period from 2020 to 2025.

In the mid-to-long term, VIYI will continue to adhere to its strategic mindset. By improving upon each iteration of VIYI’s one-stop intelligent data management solutions made possible by its proprietary central processing algorithm services, VIYI can help customers to enhance their service efficiency and make model innovations in business, and actively enhance the industry value of the central processing algorithm services in the general field of data intelligent processing industry.

On September 24, 2020, VIYI was incorporated under the laws of the Cayman Islands under the name of VIYI Technology Inc. On March 19, 2021, VIYI technology was renamed as VIYI Algorithm Inc. VIYI’s principal executive offices are located at Unit 507, Building C, Taoyuan Street, Long Jing High and New Technology Jingu Pioneer Park, Nanshan District, Shenzhen, 518052, People’s Republic of China. VIYI’s telephone number at this address is +86 (0755) 8654 9023. VIYI’s registered office in the Cayman Islands is located at Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. After the consummation of the Business Combination, VIYI will become a wholly owned subsidiary of Venus.

WiMi held 73% of VIYI’s issued and outstanding shares prior to the consummation of the Business Combination. WiMi was incorporated as an exempted company in the Cayman Islands on August 16, 2018. The ADSs of WiMi are listed on the Nasdaq Global Market under the symbol “WIMI”.

The following diagram illustrates VIYI’s corporate structure as of June 30, 2022, without giving effect to the Business Combination.

Diagram

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Historically, VIYI had a series of contractual arrangements with Shenzhen Yitian. Due to the business strategy adjustment, Shenzhen Yitian and its subsidiaries have no longer operated the business involving foreign investment restrictions since March 1, 2022, therefore VIYI can own direct equity interest in Shenzhen Yitian and its subsidiaries. On April 1, 2022, VIYI and Shenzhen Yitian have terminated the VIE arrangements and, as a result, VIYI’s WFOE holds 100% of the issued and outstanding shares of Shenzhen Yitian. VIYI now controls and receives the economic benefits of Shenzhen Yitian and its subsidiaries through equity ownership.

VIYI’s Hong Kong subsidiaries, including VIYI Technology Limited, Excel Crest Limited and Viwo Technology Limited, are holding companies, all of which have no substantial operations in Hong Kong. VIYI also has no plan for future business operations through any of the three Hong Kong subsidiaries. VIYI Technology Limited has only incurred general and administrative and financial expenses, together with certain research and development expenses for the year ended December 31, 2021. Excel Crest Limited has only incurred general and administrative expenses, which consist primarily of the compensation for its management and administrative personnel and office rental expenses for the office based in Hong Kong. Viwo Technology Limited has no operations at all as of December 31, 2021. These three Hong Kong subsidiaries will remain a part of VIYI’s organizational structure. VIYI does not have any directors or officers located in Hong Kong currently. Given that (1) VIYI’s subsidiaries located in Hong Kong have no substantial operations, and (2) pursuant to the Basic Law of the Hong Kong Special Administrative Region (the “Basic Law”), which is a national law of the PRC and the constitutional document for Hong Kong, national laws of the PRC shall not be applied in Hong Kong except for those listed in Annex III of the Basic Law (which is confined to laws relating to defense and foreign affairs, as well as other matters outside the autonomy of Hong Kong), VIYI does not believe there will be material effects on its Hong Kong Subsidiaries’ operations and financial results resulting from the legal and operational risks relating to the PRC regulations. As such, the legal and operational risks associated with VIYI’s operations in the PRC apply to its operations in Hong Kong only to the extent applicable. However, there remains regulatory uncertainty with respect to the implementation and interpretation of laws in China. VIYI is also subject to the risks of uncertainty about any future actions the Chinese government or authorities in Hong Kong may take in this regard.

Description of the historical VIE Contractual Agreements

The historical contractual arrangements consist of a series of four agreements, shareholders power of attorney and irrevocable consent letters (collectively the “Contractual Arrangements”, which were signed on December 24, 2020). The significant terms of the Contractual Agreements are described below.

Exclusive Business Cooperation Agreement

Under the exclusive business cooperation agreement between Shenzhen Weiyixin and Shenzhen Yitian dated December 24, 2020, Shenzhen Weiyixin has the exclusive right to provide to Shenzhen Yitian technical support, consulting services and other services related to, among other things, use of software, operation maintenance, technical support, and management and marketing consulting. Shenzhen Weiyixin has the exclusive ownership of intellectual property rights created as a result of the performance of this agreement. Shenzhen Yitian agrees to pay Shenzhen Weiyixin service fee at an amount equal to Shenzhen Yitian’s consolidated gross profits after offsetting previous year’s loss (if any). This agreement will remain effective until the date when it is terminated by Shenzhen Weiyixin.

Exclusive Option Agreement

Pursuant to the exclusive option agreement dated December 24, 2020, by and among Shenzhen Weiyixin, Shenzhen Yitian and each of the shareholders of Shenzhen Yitian, each of the shareholders of Shenzhen Yitian irrevocably granted Shenzhen Weiyixin an exclusive call option to purchase, or have its designated person(s) to purchase, at its discretion, all or part of their equity interests in Shenzhen Yitian, and the purchase price shall be the lowest price permitted by applicable PRC law. Shenzhen Yitian and each of its shareholders undertake that, without the prior written consent of Shenzhen Weiyixin, they may not increase or decrease the registered capital, amend its articles of association or change registered capital structure. This agreement will remain effective unless terminated in the event that the entire equity interests held by registered shareholders in Shenzhen Yitian have been transferred to Shenzhen Weiyixin and/or any other person designated by Shenzhen Weiyixin. Any transfer of equity interests pursuant to this agreement would be subject to PRC regulations and to any changes required thereunder.

Equity Interest Pledge Agreement

Shenzhen Weiyixin’s prior written approval, during the term of the equity interest pledge agreement, they will not dispose of the pledged equity interests or create or allow any other encumbrance on the pledged equity interests. The pledge under the equity interest pledge agreement shall take effect upon the completion of registration with the relevant administration for industry and commerce, which was completed as of January 29, 2021, and shall remain valid until the earlier of (1) the completion of all contractual obligations and the repayment of all secured debts, or (2) the time when the pledgee and/or the appointed person(s) have decided, subject to the PRC laws, to purchase the entire equity interests hold by the pledgor in Shenzhen Yitian, and such equity interests of Shenzhen Yitian have been transferred to the pledgee and/or the appointed person(s) in accordance with the law such that the pledgee and/or the appointed person(s) may lawfully engage in the business of Shenzhen Yitian.

Loan Agreement

Pursuant to the loan agreement dated December 24, 2020, Shenzhen Weiyixin agreed to provide loans to the registered shareholders of Shenzhen Yitian, to be used exclusively as investment in Shenzhen Yitian. The loan must not be used for any other purposes without the relevant lender’s prior written consent. The term of the loan agreement commences from the date of the agreement and ends on the date the lender exercises its exclusive option under the relevant exclusive option agreement, or when certain defined termination events occur, such as if the lender sends a written notice demanding repayment to the borrower, or upon the default of the borrower, whichever is earlier. After the lender exercises its exclusive option, the borrower may repay the loan by transferring all of its equity interest in Shenzhen Yitian to the lender, or a person or entity nominated by the lender, and use the proceeds of such transfer as repayment of the loan. If the proceeds of such transfer are equal to or less than the principal of the loan under the loan agreement, the loan is considered interest-free. If the proceeds of such transfer are higher than the principal of the loan under the loan agreement, any surplus is considered interest for the loan.

Power of Attorney

Pursuant to the power of attorney dated December 24, 2020, by Shenzhen Weiyixin and each shareholder of Shenzhen Yitian, respectively, each shareholder of Shenzhen Yitian irrevocably authorized Shenzhen Weiyixin or any person(s) designated by Shenzhen Weiyixin to act on such shareholders’ behalf with respect to all matters concerning such shareholding, including, without limitation, the power to convene, participate in and vote at shareholder’s meetings, the power to nominate directors and appoint senior management, the power to sell or transfer such shareholder’s equity interest in Shenzhen Yitian, and other shareholders’ rights permitted by PRC law and the Articles of Association of Shenzhen Yitian. The power of attorney remains irrevocable and continuously valid from the date of execution so long as each shareholder remains as a shareholder of Shenzhen Yitian.

Spousal Consent Letters

Pursuant to these letters, the spouses of the applicable shareholders of Shenzhen Yitian unconditionally and irrevocably agreed that the equity interest in Shenzhen Yitian held by them and registered in their names will be disposed of pursuant to the equity pledge agreement, the exclusive option agreement, and the power of attorney. Each of their spouses agreed not to raise any claim with respect to the equity interest in Shenzhen Yitian held by their respective spouses. In addition, in the event that any spouse obtains any equity interest in Shenzhen Yitian held by his or her spouse for any reason, he or she agreed to be bound by the contractual arrangements.

Based on the foregoing historical contractual arrangements, which grant Shenzhen Weiyixin effective control of Shenzhen Yitian and enable Shenzhen Weiyixin to receive all of their expected residual returns, VIYI accounts for Shenzhen Yitian as a VIE and VIYI is the primary beneficiary of the VIE, for accounting purposes, based upon such contractual arrangements. Accordingly, under U.S. GAAP, the financial results of the VIE are consolidated in VIYI’s financial statements on December 24, 2020. The consolidated financial statements are prepared on the basis as if the reorganization became effective as of the beginning of the first period presented in the accompanying consolidated financial statements of VIYI.

The information contained on, or accessible through, VIYI’s website is not incorporated by reference into this proxy statement, and you should not consider any information contained on, or that can be accessed through, VIYI’s website as part of this proxy statement or in deciding how to vote your shares. For more information on VIYI, please see the sections entitled “Business of VIYI” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of VIYI.”

Effect of the Completion of the Business Combination Upon Our Corporate Ownership Structure

Assuming the Business Combination with VIYI is consummated, the corporate structure described above, will remain the same. However, VIYI will be owned by Venus, which in turn will be owned by its shareholders, including the shareholders of VIYI receiving the shares in the Merger, the IPO investors and our Sponsor.

The following diagrams and table illustrate the ownership structure of Venus immediately following the Business Combination. The ownership percentages set forth below do not take into the exercise of any issued and outstanding Venus Warrants into New Venus ordinary shares. None of the parties in the chart below purchase Venus ordinary shares in the open market; and other than the conversion of outstanding Venus rights into 482,500 New Venus ordinary shares, there are no other issuances of equity by Venus prior to or in connection with the consummation of the Business Combination.

The diagrams below depict a simplified version of New Venus’ organizational structure immediately following the completion of the Business Combination under two scenarios.

Scenario 1 Combined (Assuming No Redemptions Into Cash):

Diagram, table

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Scenario 2 Combined (Assuming Maximum Redemptions Into Cash)

Table

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The equity interests shown in the table below were calculated based on the assumptions that (i) no Venus shareholder exercises its redemption, and (ii) Maximum Venus shareholder properly exercises its redemption, or 4,600,000 ordinary shares.

	Assuming No Redemption			Assuming Maximum Redemption
Venus’ public shareholders		10.97	%		1.11	%
Venus’ initial shareholders		3.03	%		3.36	%
VIYI shareholders		85.84	%		95.35	%

Transfer of cash within VIYI’s organization

VIYI operates in two segments, CPA and intelligent chips and software services. For intelligent chips and software services segment, it is mainly operated by VIYI holding and subsidiaries in Singapore, Fe-da Electronics. Both VIYI, and Fe-da Electronics has its own operating cashflow from operation of the segment. The CPA segment is mainly operated by subsidiaries in the PRC, each entity has its own operating cash flow. VIYI and Fe-da had intercompany transfers in cash of approximately RMB 8.0 million (USD 1.2 million) and the VIE had intercompany transfer of approximately RMB 106 million to VIYI’s WFOE for the year ended December 31, 2020. VIYI and VIYI Ltd had intercompany transfers in cash of approximately RMB 16.8 million (USD 2.5 million) and VIYI’s WFOE transferred RMB 12.7 million to the VIE for the year ended December 31, 2021. From January 1, 2022 to April 1, 2022, historical VIE had intercompany transfer of approximately RMB 17.6 million to VIYI’S WFOE.

For further details, please refer to page 28 to 31 “Summary Financial Information of VIYI”. There was no dividends or distribution made between VIYI, its subsidiaries and the historical VIE. VIYI has established controls and procedures for cash flows within its organization. Each transfer of cash between Cayman Islands holding company and a subsidiary, the VIE is subject to internal approval. In general cash is maintained in holding company level (VIYI for companies outside PRC and VIYI WFOE for entities inside PRC) for more efficient cash management.

VIYI has no present plans to distribute earnings and instead it plans to retain VIYI’s retained earnings to continue to grow VIYI’s business. No dividends or distribution has been declared to paid to VIYI from subsidiaries and no dividends or distribution was made to any U.S. investors.

Effects of PRC foreign exchange regulations on VIYI’s ability to transfer assets within VIYI’s organization

Current foreign exchange and other regulations in the PRC may restrict VIYI’s PRC subsidiaries in their ability to transfer their net assets to VIYI and its subsidiaries in Singapore and Hong Kong and to New Venus following the Business Combination and completion of the Merger. The PRC government imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. Under VIYI’s current corporate structure, VIYI’s Cayman Islands holding company may rely on dividend payments from VIYI’s PRC subsidiaries to fund any cash and financing requirements VIYI may have. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of SAFE by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations of VIYI’s PRC subsidiaries in China may be used to pay dividends to VIYI. However, approval from or registration with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, VIYI needs to obtain SAFE approval to use cash generated from the operations of VIYI’s PRC subsidiaries to pay off their respective debt in a currency other than Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than Renminbi.

The Circular on Further Improving Reform of Foreign Exchange Administration and Optimizing Genuineness and Compliance Verification (the “Circular 3”) which took effect on January 26, 2017, stipulates several capital control measures with respect to the outbound remittance of profits from domestic entities to offshore entities, including (i) under the principle of the genuine transaction, banks shall check the board resolutions regarding profit distribution, the original version of tax filing records and audited financial statements; and (ii) domestic entities shall hold income to account for previous years’ losses before remitting profits.

In light of the flood of capital outflows of China in 2016 due to the weakening Renminbi, the PRC government has imposed more restrictive foreign exchange policies and stepped up scrutiny of major outbound capital movement including overseas direct investment. More restrictions and substantial vetting process are put in place by SAFE to regulate cross-border transactions falling under the capital account. If any of VIYI’s shareholders regulated by such policies fail to satisfy the applicable overseas direct investment filing or approval requirement timely or at all, it may be subject to penalties from the relevant PRC authorities. The PRC government may at its discretion further restrict access in the future to foreign currencies for current account transactions. If the foreign exchange control system prevents VIYI from obtaining sufficient foreign currencies to satisfy VIYI’s foreign currency demands, VIYI may not be able to pay dividends in foreign currencies to its shareholders. For more information on the effect of PRC foreign exchange regulations affecting the transfer of assets between VIYI and the PRC subsidiaries, please see the sections entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of VIYI — Liquidity and Capital Resources.”

Venus Merger Sub

Venus Merger Sub was incorporated on May 25, 2021 under the laws of Cayman Islands for the purpose of effecting the Business Combination and to serve as the vehicle for, and be subsumed into, VIYI pursuant to the Business Combination.

The Business Combination and the Merger Agreement

The Merger Agreement was entered into by and among Venus, Venus Merger Sub, VIYI and WiMi on June 10, 2021. Pursuant to the terms of the Merger Agreement, the Venus Merger Sub will merge with and into VIYI, with VIYI being the surviving entity and becoming a wholly owned subsidiary of Venus. Venus shall continue to be publicly listed and will change its name to “MicroAlgo Inc.” immediately after the consummation of the Business Combination. New Venus refers to Venus immediately following the consummation of the Business Combination.

The aggregate consideration for the Business Combination is $400,000,000, payable in the form of approximately 39,603,961 newly issued Venus ordinary shares to VIYI shareholders. At the closing of the Business Combination, the issued and outstanding shares and all other equity interests in VIYI held by VIYI shareholders will be cancelled and ceased to exist, in exchange for the issuance of an aggregate of approximately 39,603,961 Venus ordinary shares, among which approximately 792,079 Venus ordinary shares to be issued to WiMi will be held in escrow to satisfy any indemnification obligations incurred under the Merger Agreement.

On January 24, 2022, Venus, VIYI and WiMi entered into an amendment to the Merger Agreement. The purposes of the amendment were to: (1) extend the outside termination date of the proposed merger to June 30, 2022; (2) provide for the termination of the existing backstop agreement and the new backstop agreement with the majority shareholder of VIYI as described below in this Form 8-K; and (3) acknowledge the existence of new potential governmental approvals under recent changes in China law.

On August 2, 2022, Venus, VIYI and WiMi entered into a second amendment to the Merger Agreement. The purposes of the amendment were to: (1) extend the outside termination date of the proposed merger to November 11, 2022; (2) include as a closing condition the requirement that the requisite vote of the shareholders of VIYI has been obtained; (3) include the requirement of the audited financial statement of VIYI for the year ended 2021 and reviewed financial statement of VIYI for the periods ended June 30, 2022 and March 31, 2022; and (4) make conforming changes to reflect that Purchaser will file a proxy statement with the Securities and Exchange Commission following the execution of the Amendment relating to the approval of the Purchaser’s shareholders of the Merger and the transactions contemplated by the Merger Agreement. In order to extend the deadline for Venus to consummate a business combination to November 11, 2022, the Board has resolved to extend the time to complete the business combination up to nine times to November 11, 2022 and plans to deposit the required monthly extension fee to the trust account.

On August 3, 2022, Venus, VIYI and WiMi entered into a third amendment to the Merger Agreement. The purposes of the amendment were to remove the approval of issuance by Venus of an aggregate of up to 1,485,149 Venus ordinary shares which may be issued to the Backstop Investor pursuant to the Backstop Agreement.

On August 10, 2022, Venus, VIYI and WiMi entered into a fourth amendment to the Merger Agreement (the “Amendment”). The purposes of the amendment were to change the requirement of VIYI’s quarterly reviewed financial statement for the period ended June 30, 2022 as a covenant and other conforming changes regarding the current status.

For more information about the Business Combination, please see the sections titled “Business Combination Proposal.” A copy of the Merger Agreement and Amendments to the Merger Agreement are attached to this proxy statement as Annex A.

Post-Business Combination Structure and Impact on the Public Float

The following table illustrates the ownership structure of Venus immediately following the Business Combination. The equity interests shown in the table below were calculated based on the assumptions that (i) no Venus shareholder exercises its redemption, (ii) none of the parties in the chart below purchase Venus ordinary shares in the open market; and (iii) other than the conversion of outstanding Venus rights into 482,500 New Venus ordinary shares, there are no other issuances of equity by Venus prior to or in connection with the consummation of the Business Combination. Notwithstanding the foregoing, the ownership percentages set forth below do not take into account the exercise of any issued and outstanding Venus Warrants into New Venus ordinary shares.

	Scenario 1 Combined (Assuming No Redemptions Into Cash)			Scenario 2 Combined (Assuming Maximum Redemptions Into Cash)
Weighted average shares calculation, basic and diluted
Venus public shares		4,600,000			—
Venus shares converted from rights		482,500			482,500
Venus Sponsor shares		1,375,000			1,375,000
Venus shares issued to underwriter		75,000			75,000
Venus shares issued in the Business Combination		39,603,961			39,603,961
Weighted average shares outstanding		46,136,461			41,536,461
*Percent of shares owned by VIYI shareholders⁽¹⁾*		85.8	%		95.3	%
Percent of shares owned by underwriter		0.2	%		0.2	%
Percent of shares owned by Venus initial and public shareholders		14.0	%		4.5	%

(1)

Assuming no redemptions into cash, WiMi will beneficially own 63.32% of New Venus’ ordinary shares after the consummation of the Business Combination and completion of this offering by way of its ownership of VIYI ordinary shares.

Of the total 39,603,961 ordinary shares issued in the merger to the VIYI shareholders, 2,500,000 ordinary shares will not be subject to lockup restrictions.

Domestic Issuer Status

After the consummation of the Business Combination and the completion of this offering, New Venus will remain a domestic filer until June 30, 2023, on which date it will reassess whether New Venus qualifies as a “foreign private issuer”. New Venus may qualify as a “foreign private issuer” on June 30, 2023, after which New Venus will become exempt from certain rules under the Exchange Act that would otherwise apply if New Venus was a domestic issuer. For example, as a “foreign private issuer”, New Venus:

●

will not be required to provide as many Exchange Act reports, or as frequently or as promptly, as domestic issuers with securities registered under the Exchange Act. For example, New Venus will only be required to furnish current reports on Form 6-K any information that New Venus (a) makes or is required to make public under the laws of the Cayman Islands, (b) files or is required to file under the rules of any stock exchange or (c) otherwise distributes or is required to distribute to its shareholders. In addition, New Venus will not be required to file its annual report on Form 10-K, which may be due as soon as 60 days after its fiscal year end. As a “foreign private issuer”, New Venus will be required to file an annual report on Form 20-F within four months after its fiscal year end;

●

will not be required to provide the same level of disclosure on certain issues, such as executive compensation or be required to conduct advisory votes on executive compensation;

●

will be exempt from filing quarterly reports under the Exchange Act with the SEC;

●

will not be subject to the requirement to comply with Regulation Fair Disclosure, or Regulation FD, which imposes certain restrictions on the selected disclosure of material information;

●

will not be required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and

●

will not be required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and establishing insider liability for profits realized from any “short-swing” trading transaction.

If the actual facts are different from these assumptions, the percentage ownership retained by Venus’ public shareholders following the Business Combination will be different. The public warrants and private placement warrants will become exercisable upon the completion of the Business Combination and will expire five (5) years after the completion of the Business Combination or earlier upon redemption or liquidation.

Management and Board of Directors Following the Business Combination

Effective as of the closing of the Business Combination, the board of directors of Venus will consist of five members, four of whom will be nominated by VIYI. In order to continue to satisfy the Nasdaq Capital Market listing standards, at least three of the members of the board of directors will be independent in accordance with Nasdaq listing rules. Additionally, at least one member must be designated and qualify as a “financial expert” under Securities and exchange Commission rules and regulations. See section titled “Venus’ Directors and Executive Officers after the Business Combination” for additional information.

Other Documents Relating to the Business Combination

Backstop Agreement

Venus previously executed backstop agreements with two different parties as of June 10, 2021 and January 24, 2022, respectively, each of which agreements terminated in accordance with their respective terms. No ordinary shares of Venus were purchased by them under such backstop agreements. Venus and VIYI intend to identify, if possible, one or more parties to enter into a backstop agreement similar to the ones previously executed (or similar arrangements to accomplish the transactions contemplated thereby) to assist in: (i) acquiring Venus ordinary shares in open market or in private transactions prior to the closing of the Business Combination at the then prevailing market price of the shares, or (ii) acquiring Venus ordinary shares concurrently with the closing of the Business Combination at a price per share of no greater than the redemption price per share plus $0.05 an agreed upon premium above such redemption price; and in each case waiving the redemption rights associated with any ordinary shares so purchased. As of the date hereof, no replacement backstop investor has been identified.

Any such backstop investor will not be affiliated with any of the officers or directors of Venus. The officers and directors of Venus have not committed to purchasing any of our Ordinary Shares or other securities and are not parties to the Backstop Agreement.

Registration Rights Agreement

In connection with the transactions, Venus and VIYI shareholders have entered into a registration rights agreement as of June 10, 2021, to provide for the resale registration with respect to the shares issued to VIYI shareholders in connection with the Business Combination. Pursuant to this agreement, we have agreed that upon demand New Venus will file up to three registration statements under the Securities Act of 1933, as amended, to provide for the resale of the Merger Shares and to also include these securities in future registration statement filed by New Venus.

Transaction Support Agreement

In connection with the transactions, Venus and each VIYI shareholder have entered into a Company Transaction Support Agreement as of June 10, 2021, pursuant to which VIYI shareholders agreed, among other things, (i) not to redeem any of Venus ordinary shares which may be owned by them which may be acquired prior to the closing of the Business Combination; (ii) to vote at any meeting of shareholders of Venus and VIYI all such Venus ordinary shares or VIYI ordinary shares, as the case may be, in favor of the Business Combination and the transactions contemplated by the Merger Agreement and in favor of the other proposals contained in Venus’ Proxy statement; (iii) to be bound by certain other covenants and agreements related to the Business Combination, and (iv) to be bound by certain transfer restrictions with respect to such VIYI ordinary shares prior to the closing of the Business Combination, in each case, on the terms and subject to the conditions set forth in the Company Transaction Support Agreement.

Escrow Agreement

In connection with the transactions, Venus, WiMi and an escrow agent will enter into an Escrow Agreement pursuant to which approximately 792,079 Venus ordinary shares to be issued by Venus to WiMi will be held in

escrow to secure the indemnification obligations as contemplated by the Merger Agreement. The form of Escrow Agreement shall be in the customary form used by such escrow agent for similar transactions consistent with the terms of the Merger Agreement.

Lock-up Agreements

In connection with the transactions, Venus will enter into a Lock-Up Agreement (the form of which is attached as Exhibit B to the Merger Agreement) with each VIYI shareholder and Venus’ Sponsor, Yolanda Management Corporation, with respect to certain lock-up arrangements, which will provide that such VIYI shareholder and Venus’ Sponsor will not, within a certain period of time from the closing of the Business Combination, offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, subject to express carve-outs therein, any of the shares issued in connection with the Business Combination, enter into a transaction that would have the same effect, or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any of the economic consequences of ownership of such shares, whether any of these transactions are to be settled by delivery of any such shares, in cash, or otherwise.

The Lock-up Agreement provides that except for an aggregate of 2,500,000 Venus ordinary shares received by certain VIYI shareholders, all shares held by the parties to the lock-up agreements will be subject to restrictions of sale, transfer or assignment as follows: (A) 50% of the shares until the earlier of (i) six (6) months after the date of the consummation of the Merger or (ii) the date on which the closing price of our ordinary shares equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after the Merger, and (B) the remaining 50% of the shares may not be transferred, assigned or sold until six months after the date of the consummation of the Merger.

Non-competition and Non-solicitation Agreements

In connection with the transactions, Venus and VIYI will enter into a Non-competition and Non-solicitation Agreement (the form of which is attached as Exhibit E to the Merger Agreement) with each VIYI shareholder in favor of Venus and VIYI. Pursuant to these agreements, the VIYI shareholders shall agree not to compete with VIYI’s business, nor support any affiliate in competing with VIYI’s business during the two years following the closing of the Merger. Additionally, none of such persons will encourage, induce or solicit any employee, director or officer of VIYI to leave VIYI.

Redemption Rights

You will be entitled to receive cash for any public shares to be redeemed only if you:

(i)

hold public Venus ordinary shares or hold public Venus ordinary shares through Venus Units and you elect to separate your Venus Units into the underlying public Venus ordinary shares, public Venus Rights and public Venus Warrants prior to exercising your redemption rights with respect to the public Venus ordinary shares; and

(ii)

prior to [●], (a) submit a written request to the transfer agent that Venus redeems your public shares for cash and (b) deliver your public shares to the transfer agent, physically or electronically through DTC.

Holders of outstanding Venus Units must separate the underlying Venus ordinary shares, Venus Warrants and Venus Rights prior to exercising redemption rights with respect to the Venus ordinary shares. If Venus Units are registered in a holder’s own name, the holder must deliver the certificate for its Venus Units to the transfer agent with written instructions to separate the Venus Units into their individual component parts. This must be completed far enough in advance to permit the mailing of the certificates back to the holder so that the holder may then exercise his, her or its redemption rights upon the separation of the Venus ordinary shares from the Venus Units.

send written instructions by facsimile to the transfer agent. Such written instructions must include the number of Venus Units to be separated and the nominee holding such Venus Units. The beneficial owner’s nominee must also initiate electronically, using DTC’s DWAC system, a withdrawal of the relevant Venus Units and a deposit of an equal number of Venus ordinary shares, Venus Warrants and Venus Rights. This must be completed far enough in advance to permit the nominee to exercise the beneficial owner’s redemption rights upon the separation of the Venus ordinary shares from the Venus Units. While this is typically done electronically the same business day, beneficial owners should allow at least one full business day to accomplish the separation. If beneficial owners fail to cause their Venus ordinary shares to be separated in a timely manner, they will likely not be able to exercise their redemption rights.

In seeking shareholder approval of the Business Combination, Venus’ Memorandum and Articles of Association provides that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the ordinary shares sold in Venus’ IPO, which Venus refers to as the “Excess Shares.” However, Venus would not be restricting shareholders’ ability to vote all of their shares (including Excess Shares) for or against the Business Combination.

The Proposals

At the Extraordinary General Meeting, the Venus’ shareholders will be asked to vote on the following:

●

the Business Combination Proposal to approve the Business Combination;

●

the Director Election Proposal;

●

the Nasdaq Stock Issuance Proposal;

●

the Share Increase Proposal;

●

the Name Change Proposal;

●

the Articles Amendment Proposal; and

●

The Adjournment Proposal to approve the adjournment of the Extraordinary General Meeting in the event Venus does not receive the requisite shareholder vote to approve the Business Combination.

Please see the sections titled “The Extraordinary General Meeting” on page 1 for more information on the foregoing Proposals.

Voting Securities, Record Date

As of [●], there were 6,050,000 shares of Venus ordinary shares issued and outstanding. Only Venus’ shareholders who hold shares of Venus ordinary shares of record as of the close of business on [●] (“Record Date”) are entitled to vote at the Extraordinary General Meeting or any adjournment of the Extraordinary General Meeting. Approval of the Business Combination Proposal will require the affirmative vote of a majority of the votes cast by the holders of the issued Venus ordinary shares entitled to vote thereon which were present at the meeting to approve the Business Combination; provided, however, that if [●] or more of the ordinary shares purchased in the IPO demand redemption of their Venus ordinary shares, then the Business Combination may not be completed. Approval of the Share Increase Proposal, Directors Election Proposal, the Nasdaq Stock Issuance Proposal and Adjournment Proposal will require the affirmative vote of at least a majority of the votes cast by the holders of the issued Venus ordinary shares present in person or represented by proxy at the Extraordinary General Meeting and entitled to vote on such matter. Approval of the Name Change Proposal, and the Articles Amendment Proposal will require the affirmative vote of at least a two-thirds majority of the votes cast by the holders of the issued Venus ordinary shares of the Company present in person or represented by proxy at the Extraordinary General Meeting and entitled to vote on such matter (to be passed as special resolutions).

As of [●], the initial shareholders (our Sponsor) owned and were entitled to vote 1,375,000 shares of Venus ordinary shares, or approximately 22.73% of Venus’ issued and outstanding shares. With respect to the Business Combination, the initial shareholders which own approximately [●]% of Venus’ outstanding shares as of the Record Date, have agreed to vote its Venus ordinary shares in favor of Business Combination Proposal although there is no agreement in place with respect to voting on the other Proposals.

Anticipated Accounting Treatment

The Business Combination will be accounted for as a reverse merger in accordance with U.S. GAAP. Under this method of accounting, Venus will be treated as the “acquired” company for financial reporting purposes. This determination was primarily based on the holders of VIYI expecting to have a majority of the voting power of the post-combination company, VIYI’s senior management comprising all of the senior management of New Venus, the relative size of VIYI compared to Venus, and VIYI’s operations comprising the ongoing operations of New Venus. Accordingly, for accounting purposes, the Business Combination will be treated as the equivalent of VIYI’s issuing shares for the net assets of Venus, accompanied by a recapitalization. The net assets of Venus will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination will be those of VIYI.

Regulatory Approvals

The Business Combination and the other transactions contemplated by the Merger Agreement are not subject to any additional U.S. federal or state regulatory requirements or approvals, or any regulatory requirements or approvals under the laws of the Cayman Islands, except for the registration by the Registrar of Companies in the Cayman Islands of the Plan of Merger. We are not presently required to obtain any license or regulatory approval from any PRC based authorities to complete the Business Combination.

In the opinion of VIYI’s PRC counsel, Guangdong Jiayin law firm, a copy of which is field as an exhibit to this Proxy Statement, VIYI’s PRC subsidiaries are in possession of the requisite licenses and permits from the PRC government authorities that are material to the business operations of VIYI in the PRC. However, VIYI, its PRC subsidiaries, are subject to the risks of uncertainty about any future actions of the PRC government which may result in a material change in VIYI’s operations. For a description of the licenses and approvals that VIYI’s PRC subsidiaries are required to obtain for the operations in China as of the date of this proxy statement, see “Regulations Applicable to VIYI.”

PRC counsel has further advised that permits, licenses, or operations of some of VIYI’s subsidiaries may be subject to challenges from the PRC authorities. VIYI may not be able to timely obtain or maintain all the required licenses or approvals, permits, or to complete filing, registrations or other formalities necessary for VIYI’s present or future operations, and VIYI may not be able to renew certain permits or licenses or renew certain filing, registration or other formalities. For risks relating to licenses and approvals required for the operations of VIYI in China, see “Risk Factors — Risk Factors Relating to VIYI’s Business and Industry — VIYI may be materially and adversely affected by the complexity, uncertainties and changes in PRC regulation of the Internet industry and companies.”

According to the opinion provided by Guangdong Jiayin law firm, VIYI is currently not required to obtain permissions from any of the PRC authorities to operate and issue VIYI’s ordinary shares to foreign investors. In addition, VIYI and VIYI’s subsidiaries are not required to obtain permission or approval from the PRC authorities including the CSRC and Cyberspace Administration of China (“CAC”), nor has VIYI, VIYI’s subsidiaries, applied for or received any denial for the operation. However, there are substantial uncertainties regarding the interpretation and application of the current and future PRC laws and regulations, and VIYI cannot assure you that the regulators in the PRC will not adopt new laws, regulations and rules or detailed implementations and interpretations or will not subsequently require VIYI to undergo the approval procedures and subject it to sanctions.

From a listing eligibility perspective, in the opinion of VIYI’s PRC counsel Guangdong Jiayin law firm, VIYI is currently not required to obtain approval from the CSRC under the M&A Rules to list on the U.S. stock exchanges and thus has not received any explicit permission or denial from the CSRC, CAC or other Chinese authorities. However, there are risks and uncertainties with respect to when and whether VIYI will be required to obtain permission from the PRC government to list on the U.S. stock exchanges in the future, and even when such permissions are obtained, whether they will be denied or rescinded.

To further illustrate the uncertainties described above, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council recently jointly issued the “Opinions on Severely Cracking Down on Illegal Securities Activities According to Law,” or the Opinions, which was made available to the public on July 6, 2021. The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies. Effective measures, such as promoting the construction of relevant regulatory systems will be taken to deal with the risks and incidents of China-concept overseas listed companies, and cybersecurity and data privacy protection

requirements and similar matters. The Opinions and any related implementing rules to be enacted may subject VIYI to compliance requirements in the future. Given the current regulatory environment in the PRC, VIYI is still subject to the uncertainty of interpretation and enforcement of the rules and regulations in the PRC, which can change quickly with little advance notice, and any future actions of the PRC authorities.

VIYI have been closely monitoring regulatory developments in China regarding any necessary approvals from the CSRC, CAC, or other PRC regulatory authorities required for overseas listings. VIYI cannot assure you that the PRC regulatory authorities, including the CAC, would take the same view as VIYI does, and there is no assurance that VIYI can fully or timely comply with such laws. In the event that VIYI becomes subject to any mandatory cybersecurity review and other specific actions required by the CAC, VIYI faces uncertainty as to whether any clearance or other required actions can be timely completed, or at all. Given such uncertainty, VIYI may be further required to suspend its relevant business, shut down its website, or face other penalties, which could materially and adversely affect its business, financial condition, and results of operations. For risks relating to regulatory approvals on overseas listings and the oversight of the CAC, please refer to “Risk Factors — Risk Factors Relating to VIYI’s Business and Industry — VIYI may be liable for improper use or appropriation of personal information provided directly or indirectly by its customers or end users.”

VIYI may also be subject to penalties and sanctions imposed by PRC regulatory agencies, including the CSRC if it fails to comply with their rules and regulations, which could affect the ability of VIYI to list on Nasdaq or foreign exchanges in other jurisdictions. All of these factors may affect the value of investors’ securities in New Venus after the consummation of the Business Combination. For the detailed discussion of risks associated with the VIE structure, please refer to “Risk Factors — Risk Factors Relating to Doing Business in China — The PRC government exerts substantial influence over the manner in which VIYI, its subsidiaries, and the VIE must conduct its business activities. VIYI is currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if VIYI was required to obtain approval in the future and was denied permission from Chinese authorities to list on U.S. exchanges, VIYI will not be able to continue listing on U.S. exchange, which would materially affect the interest of the investors.”

PRC counsel has further advised that the CSRC has not issued any definitive rules or interpretations concerning whether offerings such as this offering are subject to the CSRC approval procedures under the M&A Rules. Although VIYI is of the position that it is not required to obtain approval from the CSRC under the M&A Rules for listing and trading its securities after the consummation of the Business Combination, uncertainties still exist as to how the M&A Rules will be interpreted and implemented and the Opinion stated above is subject to any new laws, rules and regulations or detailed implementations and interpretations in any form relating to the M&A Rules. For risks relating to regulatory approvals on overseas listings and the approval of the CSRC, please refer to “Risk Factors — Risks Factors Relating to Doing Business in China — The M&A Rules and certain other PRC regulations may make it more difficult for VIYI to pursue growth through acquisitions.”

Interests of Certain Persons in the Business Combination

When you consider the recommendation of Venus’ board of directors in favor of approval of the Business Combination Proposal and the other related Proposals, you should keep in mind that Venus’ directors and officers have interests in the Business Combination that are different from, or in addition to, your interests as a shareholder, including the following:

●

If the proposed Business Combination is not completed by November 11, 2022, the date that is 21 months from the closing of the IPO, if the time period is extended as previously described herein, Venus will cease all operations and liquidate as previously described herein, in such event:

●

the 1,150,000 shares of Venus ordinary shares held by the initial shareholders, which were acquired prior to the IPO for an aggregate purchase price of $25,000, will be worthless. Such shares had an aggregate market value of approximately $[●] based on the closing price of Venus ordinary shares of $[●] on the Nasdaq Capital Market as of [●];

●

the 225,000 private units purchased by the Sponsor for a total purchase price of $2,250,000, will be worthless. Such private units had an aggregate market value of approximately $[●] closing price of Venus Units of $[●] on the Nasdaq Capital Market as of [●];

Recommendations of Venus’ Board of Directors to Venus’ Shareholders

After careful consideration of the terms and conditions of the Merger Agreement, the Venus’ board of directors has determined that the Business Combination and the transactions contemplated thereby are fair to and in the best interests of Venus and its shareholders. In reaching its decision with respect to the Business Combination, the Venus’ board of directors reviewed various industry and financial data and the due diligence and evaluation materials provided by VIYI. The Venus’ board of directors also obtained a fairness opinion from King Kee, a third party valuation firm, on which to base its assessment. Venus’ board of directors recommends that Venus’ shareholders vote:

●

the Business Combination Proposal to approve the Business Combination;

●

the Director Election Proposal;

●

the Nasdaq Stock Issuance Proposal;

●

the Share Increase Proposal;

●

the Name Change Proposal;

●

the Articles Amendment Proposal; and

●

The Adjournment Proposal to approve the adjournment of the Extraordinary General Meeting in the event Venus does not receive the requisite shareholder vote to approve the Business Combination.

Summary Risk Factors

In evaluating the Business Combination and the Proposals to be considered and voted on at the Extraordinary General Meeting, you should carefully review and consider the risk factors set forth under the section titled “Risk Factors” beginning on page 39 of this proxy statement. Below is a summary of material factors that make an investment in our ordinary shares speculative or risky. Importantly, this summary does not address all of the risks that we and VIYI face. The occurrence of one or more of the events or circumstances described in that section, alone or in combination with other events or circumstances, may have a material adverse effect on (i) Venus’ ability to complete the Business Combination, and (ii) the business, cash flows, financial condition and results of operations of New Venus following consummation of the Business Combination. These risks include, but are not limited to the following:

●

VIYI may be materially and adversely affected by the complexity, uncertainties and changes in PRC regulation of the Internet industry and companies. Please refer to “Risk Factors — Risk Factors Relating to VIYI’s Business and Industry — VIYI may be materially and adversely affected by the complexity, uncertainties and changes in PRC regulation of the Internet industry and companies.” on page 49 of this proxy statement.

●

VIYI’s business generates and processes a large amount of data, and VIYI is required to comply with PRC laws and regulations relating to cyber security. These laws and regulations could create unexpected costs, subject VIYI to enforcement actions for compliance failures, or restrict portions of VIYI’s business or cause VIYI to change its data practices or business model. Please refer to “Risk Factors — Risk Factors Relating to VIYI’s Business and Industry — VIYI may be liable for improper use or appropriation of personal information provided directly or indirectly by its customers or end users.” on page 50 of this proxy statement.

●

Sudden or unexpected changes with little advance notice in China’s economic, political, or social conditions or government policies could have a material adverse effect on VIYI’s business and operations. Please refer to “Risk Factors — Risks Factors Relating to Doing Business in China —Uncertainties in the promulgation, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and VIYI.” on page 58 of this proxy statement.

●

The PRC government may intervene or influence VIYI’s operations at any time or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in VIYI’s operation and/or the value of VIYI’s ordinary shares. Please refer to “Risk Factors — Risks Factors Relating to Doing Business in China — VIYI is subject to extensive and evolving legal system in the PRC, non-compliance with which, or changes in which, may materially and adversely affect VIYI’s business and prospects, and may result in a material change in VIYI’s operations

and/or the value of VIYI’s ordinary shares or could significantly limit or completely hinder VIYI’s ability to offer or continue to offer securities to investors and cause the value of VIYI’s securities to significantly decline or be worthless.” on page 59 of this proxy statement.

●

Any actions by the PRC government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers could significantly limit or completely hinder VIYI’s ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless. VIYI is currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if VIYI were required to obtain approval in the future and were denied permission from Chinese authorities to list on U.S. exchanges, VIYI will not be able to continue listing on U.S. exchange, which would materially affect the interest of the investors. Please refer to “Risk Factors — Risks Factors Relating to Doing Business in China — The PRC government exerts substantial influence over the manner in which VIYI, its subsidiaries must conduct its business activities. VIYI is currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if VIYI was required to obtain approval in the future and was denied permission from Chinese authorities to list on U.S. exchanges, VIYI will not be able to continue listing on U.S. exchange, which would materially affect the interest of the investors.” on page 54 of this proxy statement.

●

You may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in China against VIYI or VIYI’s management named in the proxy statement based on foreign laws. It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China. Please refer to “Risk Factors — Risks Factors Relating to Doing Business in China — Certain judgments obtained against VIYI by its shareholders may not be enforceable.” on page 62 of this proxy statement.

●

Recent joint statement by the SEC and the PCAOB, proposed rule changes submitted by Nasdaq, and an act passed by the U.S. Senate all call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. These developments could add uncertainties to VIYI’s offering that trading in VIYI’s securities may be prohibited under the HFCA Act. Currently VIYI’s auditor is headquartered in New York and has been inspected by the PCAOB on a regular basis. Therefore, it is not subject to the determinations announced by the PCAOB on December 16, 2021.

However, in the event the PRC authorities would further strengthen regulations over auditing work of Chinese companies listed on the U.S. stock exchanges, the PCAOB may not be able to inspect or fully investigate VIYI’s auditor and as a result, Nasdaq may determine to delist VIYI’s securities. Please refer to “Risk Factors — Risks Factors Relating to Doing Business in China — The recent joint statement by the SEC and PCAOB, proposed rule changes submitted by Nasdaq, and the Holding Foreign Companies Accountable Act all call for additional and more stringent criteria to be applied to emerging market companies, including companies based in China, upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB.” on page 57 of this proxy statement.

Other Venus Considerations

The Board of Directors focused its analysis on whether the Business Combination is likely to generate a return for Venus’s stockholders that is greater than if the trust were to be liquidated. Our Board of Directors unanimously concluded that the Merger Agreement with VIYI is fair to and in the best interests of the Venus stockholders. See “The Business Combination Proposal — Basis for Venus Board of Directors’ Recommendation — Fairness Opinion”.

Recommendation of Venus’s Board of Directors

After careful consideration, Venus’s Board of Directors determined that the Business Combination with VIYI is fair to, and in the best interests of, Venus and its stockholders. On the basis of the foregoing, Venus’s Board of Directors has approved and declared advisable the Business Combination and recommends that you vote or give instructions to vote “FOR” each of the Business Combination Proposal and the other Proposals.

Venus’s Board of Directors have interests that may be different from, or in addition to your interests as a stockholder. See “The Business Combination Proposal — Interests of Certain Persons in the Business Combination” for further information.

SUMMARY FINANCIAL INFORMATION OF VIYI

The following selected consolidated statements of income and comprehensive income for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022, selected consolidated balance sheets data as of December 31, 2020 and 2021 and June 30, 2022 selected consolidated cash flow data for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022 have been derived from VIYI’s consolidated financial statements included elsewhere in this proxy statement and have been prepared on the same basis as VIYI’s consolidated financial statements and have included all adjustments, consisting only of normal and recurring adjustments, that VIYI considers necessary for a fair statement of VIYI’s financial position and operating results for the periods presented. The historical results included below and elsewhere in this proxy statement are not indicative of VIYI’s future performance. You should read the section headed “Selected Historical Consolidated Financial and Operating Data of VIYI” together with VIYI’s consolidated financial statements and the section headed “Management’s Discussion and Analysis of Financial Condition and Results of Operations of VIYI” contained elsewhere herein.

The following table represents VIYI’s selected consolidated statements of income and comprehensive income for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022:

Selected Consolidated Statements of Income and Comprehensive Income:

	For the Years Ended December 31,									For the Six Months Ended June 30,
	2020			2021			2021			2021			2022			2022
	RMB			RMB			USD			RMB			RMB			USD
										(Unaudited)			(Unaudited)			(Unaudited)
Operating revenues		307,788,730			529,250,664			83,010,597			228,946,224			345,774,201			51,520,428
Cost of revenues		(182,618,305	)		(315,597,133	)		(49,499,997	)		(108,062,907	)		(276,424,458	)		(41,187,302	)
Gross profit		125,170,425			213,653,531			33,510,600			120,883,317			69,349,743			10,333,126
Operating expenses		(31,084,452	)		(161,722,739	)		(25,365,487	)		(59,990,080	)		(55,000,612	)		(8,195,102	)
Income from operations		94,085,973			51,930,792			8,145,113			60,893,237			14,349,131			2,138,024
Other (expenses) income, net		(167,503	)		3,354,208			526,093			2,628,208			380,015			56,623
Provision for income taxes		(2,446,634	)		(547,209	)		(85,827	)		210,169			500,177			74,526
Net income		91,471,836			54,737,791			8,585,379			63,731,614			15,229,323			2,269,173
Less: Net loss attributable to non-controlling interests		(11,591	)		(538,060	)		(84,392	)		(130,216	)		228,367			34,027
Net income attributable to VIYI Algorithm Inc.		91,483,427			55,275,851			8,669,771			63,861,830			15,000,956			2,235,146
Other comprehensive income (loss)		(2,130,654	)		(455,030	)		(71,369	)		(446,443	)		1,377,873			205,303
Comprehensive income attributable to Algorithm Inc.		89,352,773			54,820,821			8,598,402			63,415,387			16,378,829			2,440,449

The following table represents VIYI’s selected consolidated balance sheet data as of December 31, 2020 and 2021 and June 30, 2022:

Selected Consolidated Balance Sheet Data:

	As of December 31,						As of June 30,
	2020		2021		2021		2022		2022
	RMB		RMB		USD		RMB		USD
							(Unaudited)		(Unaudited)
Current assets		304,473,636		344,264,627		53,996,364		372,987,806		55,575,260
Other assets		178,148,116		176,068,052		27,615,484		176,211,427		26,255,539
Total assets		482,621,752		520,332,679		81,611,848		549,199,233		81,830,799
Total liabilities		163,012,407		146,440,243		22,968,493		158,699,601		23,646,272
Total VIYI Algorithm Inc. shareholders’ equity		317,521,266		372,342,087		58,400,190		388,720,916		57,919,498
Non-controlling interests		2,088,079		1,550,349		243,165		1,778,716		265,029
Total shareholders’ equity		319,609,345		373,892,436		58,643,355		390,499,632		58,184,527

The following table represents VIYI’s selected consolidated cash flow data for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022:

Selected Consolidated Cash Flow Data:

	For the Years Ended December 31,									For the Six Months Ended June 30,
	2020			2021			2021			2021			2022		2022
	RMB			RMB			USD			RMB			RMB		USD
										(Unaudited)			(Unaudited)		(Unaudited)
Net cash provided by operating activities		96,200,132			98,530,184			15,454,018			44,942,528			2,216,206		330,216
Net cash provided by (used in) investing activities		33,514,895			(41,830,676	)		(6,560,953	)		(208,475	)		18,269,079		2,722,096
Net cash provided by (used in) financing activities		112,966,844			(25,079,283	)		(3,933,573	)		(11,544,836	)		4,164,177		620,463
Effect of exchange rate on cash and cash equivalents		(2,722,041	)		(1,394,150	)		(218,668	)		(542,682	)		5,513,861		821,566
Change in cash and cash equivalents		239,959,830			30,226,075			4,740,824			32,646,535			30,163,323		4,494,341
Cash and cash equivalents, beginning of period		2,182,694			242,142,524			37,978,971			242,142,524			272,368,599		40,582,978
Cash and cash equivalents, end of period		242,142,524			272,368,599			42,719,795			274,789,059			302,531,922		45,077,319

The following tables show the financial position, cash flows, and results of operations for VIYI, the VIE, and subsidiaries in China as of December 31, 2020 and December 31, 2021, respectively.

VIYI ALGORITHM INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEETS

AS OF DECEMBER 31, 2020

(in RMB)

	VIYI Cayman				Subsidiaries outside PRC				Elimination				Total (Outside PRC)			Historical VIE			Subsidiaries in PRC			Elimination			Total in side PRC			Elimination			Consolidating
Cash		40,656,241				9,840,443								50,496,684			27,683,293			163,962,547						191,645,840			—			242,142,524
Other current assets		4,971,188				26,752,646								31,723,834			30,607,278									30,607,278						62,331,112
Total Current assets		45,627,429				36,593,089								82,220,518			58,290,571			163,962,547						222,253,118						304,473,636

Property and equipment, net		—				342,434								342,434			35,837			—						35,839						378,273
Receivables from subsidiaries		—				7,829,880		(1)		(7,829,880	)			—			161,960,000	(2)		—			(161,960,000	)		—						—
Investment in Subsidiaries		388,024,736				—				(106,188,748	)			281,835,988			—			—						—			(281,835,988	)		—
Due from VIE		—												—						281,878,458	(3)		(281,878,458	)
Other noncurrent assets		—				82,039,711								82,039,711			95,193,706			536,426						95,730,132						177,769,843
Total Assets		433,652,165				126,805,114				(114,018,628	)			446,438,651			315,480,114			446,377,431			(443,838,458	)		318,019,089			(281,835,988	)		482,621,752
Due from VIE																				161,960,000	(2)		(161,960,000	)
Other payables – intercompany		7,830,011		(1)						(7,830,011	)			—			—			—			—			—						—
Due to WiMi		106,352,004												106,352,004			12,725,539									12,725,539						119,077,543
Other payables and accrued liabilities		84,753				15,719,964								15,804,717			20,402,445			238,684						20,641,128						36,445,849
Total current liabilities		114,266,768				15,719,964				(7,830,011	)			122,156,721			33,127,984			162,198,684			(161,960,000	)		33,366,667						155,523,392

Business acquisition payable		1,864,131				—								1,864,131			—			—						—						1,864,131
Other non-current liabilities		—				4,896,533								4,896,533			473,672			254,676						728,348						5,624,884
Total Liabilities		116,130,899				20,616,497				(7,830,011	)			128,917,385			33,601,656			162,453,360			(161,960,000	)		34,095,018						163,012,407

SHAREHOLDERS’ EQUITY
Capital		186,588,331				81,588,798				(81,588,798	)			186,588,331			183,220,254			—			(183,220,254	)		—			—			186,588,331
Retained earnings		128,098,769				26,004,952				(26,004,952	)			128,098,769			93,693,384			276,871,172			(93,693,384	)		276,871,172			(276,871,172	)		128,098,769
Statutory reserves		4,964,820				—								4,964,820			4,964,820			4,964,820			(4,964,820	)		4,964,820			(4,964,820	)		4,964,820
Accumulated other comprehensive loss		(2,130,654	)			(1,405,133	)			1,405,133				(2,130,654	)		—			—						—			—			(2,130,654	)
Total VIYI Algorithm Inc. shareholders’ equity		317,521,266				106,188,617				(106,188,617	)	(4)		317,521,266			281,878,458	(3)		281,835,992			(281,878,458	)		281,835,992	(4)		(281,835,992	)		317,521,266

NONCONTROLLING INTERESTS		—				—				—				—			—			2,088,079						2,088,079						2,088,079
Total equity		317,521,266				106,188,617				(106,188,617	)			317,521,266			281,878,458			283,924,071			(281,878,458	)		283,924,071			(281,835,992	)		319,609,345
Total liabilities and shareholders’ equity		433,652,165				126,805,114				(114,018,628	)			446,438,651			315,480,114			446,377,431			(443,838,458	)		318,019,089			(281,835,992	)		482,621,752

(1)

The amount represents cash transfer to VIYI from subsidiary Fe-da Electronics for the year ended December 31, 2020 as a part of the Company’s cash management to keep cash at holding company level for more efficient cash management. The balance is still outstanding as of June 30, 2022.

(2)

This amount represents cash transfer to VIYI WFOE from the historical VIE as a part of the Company’s cash management to keep cash at holding company level for more efficient cash management. Approximately RMB 12.7 million of the balance is transferred back to the historical VIE in 2021. Balance of RMB 93.5 million is outstanding as intercompany receivable from VIYI WFOE on April 1, 2022 when the VIE agreements were terminated and VIYI WFOE owned 100% equity interest of Shenzhen Yitian.

(3)

Due from VIE represents the total equity of the historical VIE that was pledged to VIYI WFOE when the contractual agreement were signed on December 24, 2020 and current year service income recorded by VIYI WFOE. This amount is reclassified to Investment from subsidiaries on April 1, 2022 when the VIE agreements were terminated and VIYI WFOE owned 100% equity interest of Shenzhen Yitian.

(4)

This amount represents VIYI’s investment in subsidiaries which represent the total equity of its subsidiaries and is eliminated upon consolidation.

VIYI ALGORITHM INC. AND SUBSIDIARIES

UNAUDITED CONDENDSED CONSOLIDATING STATEMENTS OF INCOME

FOR THE YEAR ENDED DECEMBER 31, 2020

(in RMB)

	VIYI Cayman			Subsidiaries outside PRC			Historical VIE				Subsidiaries in PRC			Elimination			Total in PRC			Elimination			Consolidating
Operating revenues		33,780,394			124,413,884			149,575,631				18,821						149,594,452						307,788,730
Cost of revenues		(1,930,254	)		(112,674,846	)		(68,013,204	)			—						(68,013,204	)					(182,618,305	)
Gross profit		31,850,140			11,739,038			81,562,427				18,820						81,581,248						125,170,425
Operating expenses		(4,213,002	)		(2,967,688	)		(23,743,894	)			(159,868	)					(23,903,762	)					(31,084,452	)
Income from operations		27,637,138			8,771,349			57,818,533				(141,047	)					57,677,486						94,085,973
Other income (expense)		(923,998	)		(40,859	)		710,362				86,992						797,354						(167,503	)
Provision for income tax		—			(995,778	)		(1,450,855	)			—						(1,450,855	)					(2,446,634	)
Income from VIE⁽⁵⁾								—				57,080,040			(57,078,040	)								—
Income from subsidiaries⁽⁶⁾		64,770,287						—													(64,770,287	)		—
Non-controlling interest		—						—				11,591						11,591						11,591
Net income attributable to VIYI		91,483,427			7,734,711			57,078,040		(4)		57,035,576			(57,078,040	)		57,035,576			(64,770,287	)		91,483,427

(5)

This amount represent service income recorded by VIYI WFOE pursuant to the exclusive business cooperation agreement.

(6)

This amount represent income flow through from subsidiaries using the equity method where VIYI recorded equity income from its subsidiaries, of which approximately RMB 57.1 million were flow through from service income of the historical VIE.

VIYI ALGORITHM INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

FOR THE YEAR ENDED DECEMBER 31, 2020

(in RMB)

	VIYI Cayman			Subsidiaries outside PRC			Elimination			Total outside PRC			Historical VIE			Subsidiaries in PRC		Elimination			Consolidating
Net cash provided by operating activities		35,782,915			16,597,451			(7,830,011	)		44,550,355			47,797,701			3,852,076					96,200,132
Net cash provided by (used in)investing activities		(97,922,571	)		(6,194,927	)		8,277,252			(95,840,246	)		(32,604,725	)				161,959,866			33,514,895
Net cash provided by (used in) financing activities		104,508,615			—						104,508,615			10,307,625			160,110,470		(161,959,866	)		112,966,844
Effect of exchange rate		(1,712,718	)		(562,082	)		(447,241	)		(2,722,041	)		—								(2,722,041	)
Net increase in cash and cash equivalents		40,656,241			9,840,442			—			50,496,683			25,500,601			163,962,546					239,959,830
CASH AND CASH EQUIVELENTS, beginning of year		—			—									2,182,694								2,182,694
CASH AND CASH EQUIVELENTS, end of year		40,656,241			9,840,442						50,496,683			27,683,295			163,962,546					242,142,524

VIYI ALGORITHM INC. AND SUBSIDIARIES
UNAUDITED INTERIM CONDENSED CONSOLIDATING BALANCE SHEETS
AS OF DECEMBER 31, 2021

	VIYI Cayman				Subsidiaries outside PRC				Elimination			Total (Outside PRC)			Historical VIE			Subsidiaries in PRC			Elimination			Total inside PRC		Elimination			Consolidating
Cash		46,916,200				15,485,724							62,401,924			18,992,248			190,974,427						209,966,675					272,368,599
Current assets		—				16,802,541							16,802,541			850,286			33,083,201						33,933,487					50,736,028
Loan receivable		—				—							—			—			21,160,000						21,160,000					21,160,000
Total Current assets		46,916,200				32,288,265							79,204,465			19,842,534			245,217,628						265,060,162					344,264,627

Property and equipment, net		—				427,423							427,423			25,170			16,234						41,404					468,827
Intangible asset		—				19,672,188							19,672,187			—			8,208,750						8,208,750					27,880,937
Cost method investment		—				—							—			—			600,000						600,000					600,000
Long term investment		417,875,271		(5)		—				(65,534,901	)		352,340,370			—			—						—		(352,340,370	)		—
Due from VIE		—				—							—			—			105,558,372	(4)		(105,558,372	)		—					—
Other receivable-intercompany		16,003,007		(2)		7,650,840		(1)		(23,653,847	)		—			93,480,919	(3)		—			(93,480,919	)		—					—
Other receivable-related parties		—				—							—			—			9,000,000						9,000,000		(9,000,000	)		—
Deferred merger costs		3,839,567				—							3,839,567			—			—						—					3,839,567
Other noncurrent assets		—				35,027,861							35,027,861			6,046,973			102,203,888						108,250,861					143,278,721
Total Assets		484,634,045				95,066,577							490,511,872			119,395,596			470,804,872						391,161,177					52,0332,679

Current Liabilities																														—
Account payable		—				3,067,780							3,067,780			200,925			9,817,979						10,018,904					13,086,682
Deferred revenues		—				5,206,524							5,206,524			—			6,982,738						6,982,738					12,189,262
Other payables and accrued liabilities		928,511				1,397,831							2,326,340			357,299			1,978,400						2,335,699					4,662,041
Operating lease liabilities		—				237,542							237,542			42,577			767,033						809,610					1,047,152
Taxes payable		—				210,963							210,963			510,884			226,545						737,429					948,392
Due to WiMi		103,712,608				63,757							103,776,365			12,725,539			598,434						13,323,973		(9,000,000	)		108,100,338
Total current liabilities		104,641,119				10,184,397							114,825,514			13,837,224			20,371,129						34,208,353					140,033,867

Due to VIE		—				—							—			—			93,480,919	(3)		(93,480,919	)		—
Other payables – intercompany		7,650,840		(1)		16,003,007		(2)		(23,653,847	)		—			—			—						—					—
Operating lease liabilities – noncurrent		—				—							—			—			1,009,917						1,009,917					1,009,917
Deferred tax liabilities, net		—				3,344,272							3,344,271			—			2,052,188						2,052,188					5,396,459
Total Liability		112,291,959				29,531,676							118,169,785			13,837,224			116,914,153						37,270,458					146,440,243

SHAREHOLDERS’ EQUITY
Ordinary shares & additional paid in capital		186,588,330				81,588,798				(81,588,797	)		186,588,331			94,983,760			88,236,496			(94,983,760	)		88,236,496		(88,236,496	)		186,588,331
Retained earnings		178,918,737				(12,675,088	)			2,301,076			178,918,737			7,904,166			254,683,171			(7,904,166	)		254,683,171		(254,683,171	)		178,918,737
Statutory reserves		9,420,703				—							9,420,703			2,670,446			9,420,703			(2,670,446	)		9,420,703		(9,420,703	)		9,420,703
Accumulated other comprehensive loss		(2,585,684	)			(3,378,809	)			3,500,695			(2,585,684	)		—			—						—					(2,585,684	)
Total VIYI Algorithm Inc. shareholders’ equity		372,342,086				65,534,901							372,342,086			105,558,372	(4)		352,340,370						352,340,370					372,342,086

NONCONTROLLING INTERESTS		—				—							—			—			1,550,349						1,550,349					1,550,349
Total equity		372,342,086				65,534,901							372,342,086			105,558,372			353,890,719						353,890,719					373,892,436
Total liabilities and shareholders’ equity		484,634,045				95,066,577							490,511,872			119,395,596			470,80,872						391,161,177					520,332,679

(1)

The amount represents cash transfer of RMB 7.6 million, (USD 1.2 million) to VIYI from subsidiary Fe-da Electronics for the year ended December 31, 2020 as a part of the Company’s cash management to keep cash at holding company level for more efficient cash management. The balance is still outstanding as of June 30, 2022. Change from the balance in 2020 was only due to exchange difference.

(2)

The amount represents cash transfer of RMB 16.0 million, (USD 2.5 million) from VIYI to subsidiary VIYI Ltd. for the year ended December 31, 2021 to support VIYI’ Ltd’s operations. The balance is still outstanding as of June 30, 2022.

(3)

This amount represents cash transfer of RMB 106.0 million to VIYI WFOE from the historical VIE as a part of the Company’s cash management to keep cash at holding company level for more efficient cash management for the year ended December 31, 2020. Approximately RMB 12.7 million of the balance is transferred back to the historical VIE in 2021. Balance of RMB 93.5 million is outstanding as intercompany receivable from VIYI WFOE on April 1, 2022 when the VIE agreements were terminated and VIYI WFOE owned 100% equity interest of Shenzhen Yitian.

(4)

Due from VIE represents the total equity of the historical VIE that was pledged to VIYI WFOE when the contractual agreement were signed on December 24, 2020 and service income recorded by VIYI WFOE. This amount is reclassified to Investment from subsidiaries on April 1, 2022 when the VIE agreements were terminated and VIYI WFOE owned 100% equity interest of Shenzhen Yitian.

(5)

This amount represents VIYI’s investment in subsidiaries which represent the total equity of its subsidiaries and is eliminated upon consolidation.

VIYI ALGORITHM INC. AND SUBSIDIARIES
UNAUDITED INTERIM CONDENSED CONSOLIDATING STATEMENTS OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 2021

	VIYI Cayman			Subsidiaries outside PRC			Historical VIE			Subsidiaries in PRC			Elimination			Total in PRC			Elimination			Consolidating
Operating revenues		34,838,101			221,336,684			13,428,804			259,647,075						273,075,879						529,250,664
Cost of revenue		(4,351,959	)		(214,057,453	)		(920,000	)		(96,267,721	)					(97,187,721	)					(315,597,133	)
Gross profit		30,486,142			7,279,231			12,508,804			163,379,354						175,888,158						213,653,531
Operating expenses		(7,502,047	)		(46,450,076	)		(7,516,376	)		(100,254,240	)					(107,770,616	)					(161,722,739	)
Income from operations		22,984,095			(39,170,845	)		4,992,428			63,125,114						68,117,542						51,930,792
Other income (expense)		467,418			2,724			303,804			2,580,262						2,884,066						3,354,208
Provision for income tax		—			488,082			(1,187,293	)		152,002						(1,035,291	)					(547,209	)
Income from VIE⁽⁶⁾		—			—			—			4,108,939			(4,108,939	)		—						—
Income from subsidiaries⁽⁷⁾		31,824,338			—			—			—						—			(31,824,338	)		—
Non-controlling interest		—			—			—			538,060						538,060						538,060
Net income attributable to VIYI Inc.		55,275,851			(38,680,039	)		4,108,939			70,504,377			(4,108,939	)		70,504,377			(31,824,338	)		55,275,851

(6)

This amount represent service income recorded by VIYI WFOE pursuant to the exclusive business cooperation agreement.

(7)

This amount represent income flow through from subsidiaries using the equity method where VIYI recorded equity income from its subsidiaries, of which approximately RMB 4.1 million were flow through from service income of the historical VIE.

(8)

VIYI conducted intra-Company equity transfers on January 11, 2021 after sorting out the business of each subsidiary. The former subsidiaries of VIYI’s historical VIE Shenzhen Yitian, which include Weidong, YY online, Korgas 233 and Wuhan 233, except Shenzhen Qianhai, became wholly-owned subsidiaries of VIYI’s WFOE, the entities which were subject to intra-Company equity transfer are mainly engaged in advertising algorithm services, and thus they were adjusted into a unified system, which facilitates investors to have a clearer and more comprehensive understanding of the company’s business division, and also to facilitate the company’s overall business management and development planning. Therefore, the shift in operating activity from the VIE to the subsidiaries occurred in 2021.

As a result of these equity transfers, Shenzhen Yitian and its subsidiary Shenzhen Qianhai became the remaining VIE of VIYI. Shenzhen Yitian and its subsidiary Shenzhen Qianhai possess PRC ICP licenses which enable them to operate the certain foreign-investment restricted business in telecommunication, which is a business that is part of the Negative List. This is the main reason why the historical VIE had originally been utilized instead of an equity ownership interest.

VIYI ALGORITHM INC. AND SUBSIDIARIES

UNAUDITED INTERIM CONDENSED CONSOLIDATING BALANCE SHEETS

AS OF JUNE 30, 2022

	VIYI Cayman				Subsidiaries outside PRC				Elimination			Total (Outside PRC)			Subsidiaries in PRC			Elimination			Consolidating
Cash		134,409,702				12,818,380							147,228,082			155,303,839						302,531,922
Current assets		—				13,410,499							13,410,499			57,045,385						70,455,884
Loan receivable		—				—							—			21,160,000	(5)		(21,160,000	)		—
Total Current assets		134,409,702				26,228,879							160,638,581			233,509,224						372,987,806

Property and equipment, net		—				380,480							380,480			1,147,128						1,527,608
Intangible asset		—				17,052,070							17,052,070			7,462,500						24,514,570
Cost method investment		—				—							—			1,200,000.00			—			1,200,000
Long term investment		439,964,933				—		(3)		(67,118,241	)		372,846,692			—	(3)		(372,846,692	)		—
Other receivable—intercompany		16,845,614		(2)		8,053,680		(1)		(24,899,294	)		—			9,000,000	(6)		(9,000,000	)		—
Other receivable—related parties		—				—							—			60,400,000	(4)		(60,400,000	)		—
Deferred merger costs		4,177,622				—							4,177,622			—						4,177,622
Other noncurrent assets		—				36,690,536							36,690,536			108,101,092						144,791,627
Total Assets		595,397,871				88,405,645							591,785,981			420,819,944						549,199,233

Current Liabilities
Account payable		—				82							82			10,806,922						10,807,004
Deferred revenues		—				83,482							83,482			14,636,956						14,720,438
Other payables and accrued liabilities		1,069,130				1,105,197							2,174,326			3,247,615						5,421,946
Operating lease liabilities		—				115,450							115,450			1,223,767						1,339,217
Taxes payable		—				238,727							238,727			1,018,616						1,257,343
Due to WiMi		166,893,520				—							166,893,520			13,323,973	(4)		(60,400,000	)		119,817,493
Total current liabilities		167,962,650				1,542,938							169,505,587			44,257,849						153,363,441

Other payables – intercompany		38,714,306		(1)		16,845,614		(2)		(24,899,294	)		30,660,626			—	(5)(6)		(30,660,626	)		—
Operating lease liabilities – noncurrent		—				—							—			571,683						571,683
Deferred tax liabilities, net		—				2,898,852							2,898,852			1,865,625						4,764,477
Total Liability		206,676,956				21,287,404							203,065,065			46,695,157						158,699,601

SHAREHOLDERS’ EQUITY
Ordinary shares & additional paid in capital		186,588,331				81,588,798		(3)		(81,588,797	)		186,588,332			183,220,256	(3)		(183,220,256	)		186,588,331
Retained earnings		192,149,712				(14,478,958	)	(3)		14,478,958			192,149,712			177,935,132	(3)		(177,935,132	)		192,149,713
Statutory reserves		11,190,683				—							11,190,683			11,190,683	(3)		(11,190,683	)		11,190,683
Accumulated other comprehensive loss		(1,207,811	)			8,401		(3)		(8,401	)		(1,207,811	)		—						(1,207,811	)
Total VIYI Algorithm Inc. shareholders’ equity		388,720,915				67,118,241							388,720,916			372,346,071						388,720,916

NONCONTROLLING INTERESTS		—				—							—			1,778,716						1,778,716

Total equity		388,720,915				67,118,241							388,720,916			374,124,787						390,499,632

Total liabilities and shareholders’ equity		595,397,871				88,405,645							591,785,981			420,819,944						549,199,233

(1)

The amount represents cash transfer of RMB 8.0 million, (USD 1.2 million) to VIYI from subsidiary Fe-da Electronics for the year ended December 31, 2020 as a part of the Company’s cash management to keep cash at holding company level for more efficient cash management. The balance is still outstanding as of June 30, 2022. Change from the balance in 2020 was only due to exchange difference.

(2)

The amount represents cash transfer of RMB 168 million, (USD 2.5 million) from VIYI to subsidiary VIYI Ltd. for the year ended December 31, 2021 to support VIYI’ Ltd’s operations. The balance is still outstanding as of June 30, 2022 and the difference was due to exchange difference.

(3)

This amount represents VIYI’s investment in subsidiaries which represent the total equity of its subsidiaries and is eliminated upon consolidation.

(4)

The amount represents cash payment of RMB $60.4 million, (USD 9.0 million) to Parent, the payment made from Shenzhen Weiyixin which offset amount due to Parent from VIYI Cayman.

(5)

This amount represents VIYI Inc. collected loan repayment of RMB 21.2 million, (USD 3.2 million) from third party on behalf of its subsidiaries in the PRC.

(6)

The amount represents Weiyixin repaid the amount of RMB 9.0 million, (USD 1.3 million) to WIMI on behalf of VIYI Inc.

VIYI ALGORITHM INC. AND SUBSIDIARIES

UNAUDITED INTERIM CONDENSED CONSOLIDATING STATEMENTS OF INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 2022

	VIYI Cayman			Subsidiaries outside PRC			VIE			Subsidiaries in PRC				Elimination			Total in PRC			Elimination			Consolidating
Operating revenues		—			83,694,051			2,090,747			259,989,403							262,080,150						345,774,201
Cost of revenue		—			(79,596,212	)		(97,897	)		(196,730,349	)						(196,828,246	)					(276,424,458	)
Gross profit		—			4,097,839			1,992,850			63,259,054							65,251,904						69,349,743
Operating expenses		(3,167,659	)		(6,277,761	)		(1,299,672	)		(44,255,514	)						(45,555,186	)					(55,000,613	)
Income from operations		(3,167,659	)		(2,179,922	)		693,178			19,003,540							19,696,718						14,349,131
Other income(expense)		(33,210	)		(60,255	)		(7,970	)		481,450							473,480						380,015
Provision for income tax		—			436,307			(172,038	)		235,908							63,870						500,177
Income from VIE		—			—			—			513,170		(6)		(513,170	)		—						—
Income from subsidiaries (7)		18,201,825			—			—			—							—			(18,201,825	)		—
Non-controlling interest		—			—			—			(228,367	)						(228,367	)					(228,367	)
Net income attributable to VIYI Inc.		15,000,956			(1,803,870	)		513,170			20,005,701				(513,170	)		20,005,701			(18,201,825	)		15,000,956

(6)

This amount represent service income recorded by VIYI WFOE pursuant to the exclusive business cooperation agreement from January 1, 2022 to April 1, 2022. The agreement was terminated on April 1, 2022. VIYI conducted intra-Company equity transfers on January 11, 2021 after sorting out the business of each subsidiary. The former subsidiaries of VIYI’s historical VIE Shenzhen Yitian, which include Weidong, YY online, Korgas 233 and Wuhan 233, except Shenzhen Qianhai, became wholly-owned subsidiaries of VIYI’s WFOE, the entities which were subject to intra-Company equity transfer are mainly engaged in advertising algorithm services, and thus they were adjusted into a unified system, which facilitates investors to have a clearer and more comprehensive understanding of the company’s business division, and also to facilitate the company’s overall business management and development planning. Therefore, the shift in operating activity from the VIE to the subsidiaries occurred in 2022.

(7)

This amount represent income flow through from subsidiaries using the equity method where VIYI recorded equity income from its subsidiaries, of which approximately RMB 0.5 million were flow through from service income of the historical VIE.

COMPARATIVE PER SHARE INFORMATION

The following table sets forth the per share data of each of VIYI and Venus on a stand-alone basis and the unaudited pro forma condensed combined per share data for the year ended December 31, 2021 and for the six months ended June 30, 2022 after giving effect to the Business Combination assuming (i) no redemption of Venus ordinary shares, and (ii) maximum redemption of Venus ordinary shares as if it had been consummated on January 1, 2021, and carried forward through the interim period.

The historical book value per share is computed by dividing total ordinary shareholders’ equity by the number of Venus ordinary shares outstanding at the end of the period. The pro forma combined book value per Venus ordinary share is computed by dividing total pro forma ordinary shareholders’ equity by the pro forma number of Venus ordinary shares outstanding at the end of the period. The pro forma earnings per share of the combined company is computed by dividing the pro forma income available to the combined company’s ordinary shareholders by the pro forma weighted-average number of Venus ordinary shares outstanding over the period.

You should read the information in the following table in conjunction with the selected historical financial information summary included elsewhere in this proxy statement, and the historical financial statements of Venus and VIYI and related notes that are included elsewhere in this proxy statement. The unaudited Venus and VIYI pro forma combined per share information is derived from, and should be read in conjunction with, the unaudited pro forma condensed combined financial statements and related notes included elsewhere in this proxy statement.

The unaudited pro forma combined earnings per share information below does not purport to represent the earnings per share which would have occurred had the companies been combined during the periods presented, nor earnings per share for any future date or period. The unaudited pro forma combined book value per share information below does not purport to represent what the value of Venus and VIYI would have been had the companies been combined during the periods presented.

For the six months ended June 30, 2022:

	VIYI		Venus June 30, 2022			Pro Forma Combined Assuming No Redemptions into Cash		Pro Forma Combined Assuming Maximum Redemptions into Cash
Net income (loss) attributable to shareholders	$	2,235,146	$	(197,426	)	$	2,127,720	$	2,127,720
Weighted average shares outstanding – ordinary shares subject to possible redemption				4,600,000			46,136,461		41,536,461
Basic and diluted net (loss) income per share				(0.01	)		0.05		0.05
Weighted average shares outstanding – ordinary shares attributable to Venus Acquisition Corporation				1,450,000
Basic and diluted net (loss) income per share				(0.17	)

For the year ended December 31, 2021:

	VIYI		Venus December 31, 2021			Pro Forma Combined Assuming No Redemptions into Cash		Pro Forma Combined Assuming Maximum Redemptions into Cash
Net income (loss) attributable to shareholders	$	8,669,771	$	(812,413	)	$	8,297,358	$	8,297,358
Weighted average shares outstanding – ordinary shares subject to possible redemption				4,070,685			46,136,461		41,536,461
Basic and diluted net (loss) income per share				0.08			0.18		0.20
Weighted average shares outstanding – ordinary shares attributable to Venus Acquisition Corporation				1,415,479
Basic and diluted net (loss) income per share				(0.81	)

SECURITIES AND DIVIDENDS

Venus’ units, ordinary share, warrants and rights are each quoted on the Nasdaq, under the symbols “VENAU,” “VENA,” “VENAW,” and “VENAR,” respectively. Each VENA Unit consists of one share of ordinary share, one warrant entitling its holder to purchase one-half (1/2) of one share of ordinary share at a price of $11.50 per whole share, and one right to receive one-tenth (1/10) of one ordinary share upon the consummation of the Business Combination. Venus’ units commenced trading on the Nasdaq Capital Market on February 11, 2021. Venus’ ordinary share, public rights and public warrants commenced trading on the Nasdaq Capital Market on April 9, 2021.

Venus has not paid any cash dividends on its ordinary share to date and does not intend to pay cash dividends prior to the completion of a business combination. The payment of cash dividends in the future will be dependent upon Venus’ revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of a business combination. The payment of any dividends subsequent to the Business Combination will be at the discretion of Venus’ board of directors. It is the present intention of Venus’ board of directors to retain all earnings, if any, for use in its business operations and, accordingly, Venus’ board does not anticipate declaring any dividends in the foreseeable future.

VIYI’s securities are not currently publicly traded. Venus is applying to the New Venus ordinary shares issued in connection with the Business Combination on the Nasdaq Capital Market. Venus has applied to Nasdaq to use the symbol “MGLO” for New Venus ordinary shares and “MGLOW” for the New Venus warrants following completion of the Business Combination.

Shareholders should carefully consider the following risk factors, together with all of the other information included in this proxy statement before they decide whether to vote or instruct their vote to be cast to approve the Proposals described in this proxy statement. These risks could have a material adverse effect on the business, financial conditioning and results of operations of Venus, and could adversely affect the trading price of New Venus’ securities following the Business Combination.

VIYI provides customers with comprehensive solutions integrating central processing algorithms with software or hardware to streamline their digital services to end users, thereby helping its customers to improve end user satisfaction, achieve direct cost savings, and reduce power consumption. VIYI’s services include algorithm optimization, accelerating computing power without the need for hardware upgrades, lightweight data processing and data intelligence services. VIYI’s business and prospects mainly depend on the continuous development and growth of the central processing algorithm service industry in the PRC. The development of this industry is affected by numerous factors, including but not limited to technological innovation, user experience, the development of the Internet and Internet-based services, regulatory environment, and macro-economic environment. The markets for VIYI’s products and services are relatively new and rapidly developing and are subject to significant challenges. In addition, VIYI’s continued growth depends, in part, on its ability to respond to changes in the central processing algorithm service industry, including rapid technological evolution, continued shifts in customer demands, introductions of new products and services and emergence of new industry standards and practices. Developing and integrating new solutions, products, services or infrastructure could be expensive and time-consuming, and these efforts may not yield the benefits VIYI expects to achieve.

In addition, as the central processing algorithm service industry in China is relatively young, there are few proven methods of projecting customer demand or available industry standards on which VIYI can rely. Some of VIYI’s current monetization methods are also in a relatively preliminary stage. VIYI cannot assure you that its attempts to monetize current applications will continue to be successful, profitable or accepted, and therefore the profit potential of VIYI’s business is difficult to gauge. VIYI’s growth prospects should be considered in light of the risks and uncertainties that fast-growing early-stage companies with limited operating history in an evolving industry may encounter, including, among others, risks and uncertainties regarding VIYI’s ability to:

Addressing these risks and uncertainties will require significant capital expenditures and allocation of valuable management and employee resources. VIYI cannot assure you that it will succeed in any of these aspects or that the central processing algorithm service industry in the PRC will continue to grow at a rapid pace. If VIYI fails to successfully address any of the above risks and uncertainties, then the size of its customer base, its revenue and profits may decline.

VIYI’s competitive position and results of operations could be harmed if VIYI does not compete effectively.

The markets for VIYI’s products and services are characterized by intense competition, new industry standards, limited barriers to entry, disruptive technology developments, short product life cycles, customer price sensitivity and frequent product introductions (including alternatives with limited functionality available at lower costs or free of charge). Any of these factors could create downward pressure on pricing and profitability and could adversely affect VIYI’s ability to retain current customers or attract new customers. VIYI’s future success will depend on a continued ability to enhance and integrate VIYI’s existing products and services, introduce new products and services in a timely and cost-effective manner, meet changing customer expectations and needs, extend VIYI’s core technology into new applications, and anticipate emerging standards, business models, software

delivery methods and other technological developments. Furthermore, some of VIYI’s current and potential competitors enjoy competitive advantages such as greater financial, technical, sales, marketing and other resources, broader brand awareness, and access to larger customer bases. As a result of these advantages, potential and current customers might select the products and services of VIYI’s competitors, causing a loss of market share to VIYI.

VIYI has a limited operating history, and it may not be able to sustain rapid growth, effectively manage growth or implement business strategies.

VIYI has a limited operating history. Although VIYI has experienced significant growth since launching its business, VIYI’s historical performance results and growth rate may not be indicative of its future performance. VIYI may not be able to achieve similar results or grow at the same rate as it has in the past. To keep pace with the development of the central processing algorithm service industry in the PRC, VIYI may need to adjust and upgrade its product and service offerings or modify its business model. These adjustments may not achieve expected results and may have a material and adverse impact on VIYI’s financial conditions and results of operations.

In addition, VIYI’s rapid growth and expansion have placed, and is expected to continue to place, a significant strain on VIYI’s management and resources. There is no assurance that the future growth of VIYI will be sustained at a similar rate or at all. VIYI believes that its revenue, expenses and operating results may vary from period to period in response to a variety of factors beyond its control, which primarily include general economic conditions, emergencies and changes in policies, laws and regulations that may affect VIYI’s business operations and its ability to monitor costs. In addition, VIYI’s ability to develop new sources of revenues, diversify monetization methods, attract and retain customers, continue developing innovative technologies, increase brand awareness, expand into new market segments, and adjust to the rapidly changing regulatory environment in the PRC, will also affect its future growth to a great extent. Therefore, you should not rely on VIYI’s historical results to predict its future financial performance.

Recent acquisitions could prove difficult to integrate, disrupt the business, dilute shareholder value and strain the resources.

On September 28, 2020, VIYI acquired 100% equity interests of Fe-da Electronics. Integrating the operations of acquired businesses successfully or otherwise realizing any of the anticipated benefits of acquisitions, including anticipated cost savings and additional revenue opportunities, involves a number of potential challenges. The failure to meet these integration challenges could seriously harm the financial condition and results of operations of VIYI. Realizing the benefits of acquisitions depends in part on the integration of operations and personnel. These integration activities are complex and time-consuming, and VIYI may encounter unexpected difficulties or incur unexpected costs, including:

Acquired businesses may have liabilities or adverse operating issues that VIYI failed to discover through due diligence prior to the acquisition. In particular, to the extent that prior owners of any acquired businesses or properties failed to comply with or otherwise violated applicable laws or regulations, or failed to fulfill their contractual obligations to clients, VIYI, as the successor owner, may be financially responsible for these violations and failures and may suffer financial or reputational harm or otherwise be adversely affected. Similarly, the acquisition targets may not have as robust internal controls over financial reporting as would be expected of a public company. Acquisitions also frequently result in the recording of goodwill and other intangible assets which are subject to potential impairment in the future that could harm its financial results. VIYI may also become subject to new regulations as a result of an acquisition, including if VIYI acquires a business serving clients in a regulated industry or acquires a business with clients or operations in a country in which VIYI does not already operate. In addition, if VIYI finances acquisitions by issuing equity securities, the interests of existing shareholders may be diluted, which could affect the market price of the shares of VIYI. As a result, if VIYI fails to properly evaluate acquisitions or investments, VIYI may not achieve the anticipated benefits of any such acquisitions, and VIYI may incur costs in excess of what VIYI anticipates. Acquisitions frequently involve benefits related to the integration of operations of the acquired business. The failure to successfully integrate the operations or otherwise to realize any of the anticipated benefits of the acquisition could seriously harm the results of operations of VIYI.

Failure to maintain adequate financial, information technology and management processes and controls could result in material weaknesses which could lead to errors in VIYI’s financial reporting following completion of the Business Combination, which could adversely affect New Venus’ business.

As a subsidiary of WiMi, a public company, prior to the Business Combination, VIYI is subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and of the rules and regulations of the Nasdaq Global Market. However, failure to maintain adequate financial, information technology and management processes and controls of VIYI after the Business Combination could result in material weaknesses which could lead to errors in its financial reporting, which could adversely affect New Venus’ business. Similarly, after the consummation of the Business Combination and as an “emerging growth company,” New Venus would be exempted from the SEC’s internal control reporting requirements. New Venus may lose its emerging growth company status and become subject to the SEC’s internal control over financial reporting management and auditor attestation requirements in the year in which it is deemed to be a large accelerated filer, which would occur once the market value of its common equity held by non-affiliates exceeds $700 million as of the end of the prior fiscal year’s second fiscal quarter. While VIYI expects to attest to the effectiveness of New Venus internal controls on Form 10-K for the year ending December 31, 2022, New Venus’ independent registered public accounting firm may be required to formally attest to the effectiveness of New Venus’ internal controls over financial reporting as early as New Venus’ annual report on Form 10-K for the year ending December 31, 2022. New Venus may not be able to complete its evaluation, testing and any required remediation in a timely fashion. In addition, New Venus’ current controls and any new controls that it develops may become inadequate because of poor design and changes in its business. Any failure to implement and maintain effective internal controls over financial reporting could adversely affect the results of assessments by its independent registered public accounting firm and their attestation reports.

If New Venus is unable to certify the effectiveness of its internal controls, or if New Venus’ internal controls have a material weakness, New Venus may not detect errors timely, its consolidated financial statements could be misstated, it could be subject to regulatory scrutiny and a loss of confidence by its shareholders, which could harm New Venus’ reputation and business and adversely affect the market price of New Venus’ securities following the Business Combination.

New Venus will incur increased costs as a result of operating as a public company, and its management will devote substantial time to new compliance initiatives. If Venus completes the Business Combination and VIYI becomes part of a public company, New Venus will incur significant legal, accounting and other expenses that it did not incur as a private company. As a public company, New Venus will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted, by the SEC and the applicable stock exchange. New Venus’ management and other personnel will need to devote a substantial amount of time to these compliance initiatives and may not effectively or efficiently manage New Venus’ transition into a public company. Moreover, New Venus expects these rules and regulations to substantially increase its legal and financial compliance costs and to make some activities more time-consuming and costly. For example, New Venus expects these rules and regulations to make it more difficult and more expensive for it to obtain director and officer liability insurance and New Venus may be forced to accept

reduced policy limits or incur substantially higher costs to maintain the same or similar coverage. New Venus cannot predict or estimate the amount or timing of additional costs it may incur to respond to these requirements. The impact of these requirements could also make it more difficult for New Venus to attract and retain qualified persons to serve on its board of directors, its board committees or as executive officers.

If VIYI fails to keep up with industry trends or technological developments, or develop, acquire, market and offer new products and services, VIYI’s business, results of operations and financial condition may be materially and adversely affected.

The central processing algorithm service industry is rapidly evolving and is subject to continuous technological changes. VIYI’s success depends on its ability to continue to develop and implement services and solutions that anticipate and respond to rapid and continuing changes in technology and industry developments and offerings to serve the evolving needs of VIYI’s customers. VIYI’s growth strategy is focused on responding to these types of developments by driving innovation that will enable VIYI to expand business into new growth domains. VIYI’s competitive advantage could be adversely affected if VIYI does not invest enough in new technologies and industrial developments, or if VIYI makes the incorrect strategical investment to respond to these developments and to drive innovation. If VIYI does not sufficiently invest in new technology and industry developments, or evolve and expand VIYI’s business at sufficient speed and scale, or if VIYI does not make the right strategic investments to respond to these developments and successfully drive innovation, then VIYI’s services and solutions, results of operations, and ability to develop and maintain a competitive advantage and continue to grow could be negatively affected.

In addition, VIYI operates in a quickly evolving environment, in which there currently are, and VIYI expects will continue to be, new technology developments. New services or technologies offered by competitors or new entrants may make VIYI’s offerings less differentiated or less competitive when compared to other alternatives, which may adversely affect VIYI’s results of operations. Technological innovations may also require substantial capital expenditures in product development as well as in modification of products, services or infrastructure. In order to maintain and improve competitiveness and continue to expand VIYI’s business, VIYI needs to constantly introduce new solutions and products and services to satisfy customers’ needs, in order for VIYI to attract new customers and retain existing customers. Researching and developing new technologies and solutions require significant investment of human resources and capital. VIYI cannot assure you that any research and development efforts will be successful, or that VIYI will be able to obtain financing to cover such expenditure. Failure to adapt VIYI’s products and services to such changes in an effective and timely manner could materially and adversely affect VIYI’s business, financial condition and results of operations.

VIYI’s results of operations could materially suffer in the event of insufficient pricing to enable VIYI to meet profitability expectations.

If VIYI is not able to obtain sufficient pricing for its services and solutions, VIYI’s revenues and profitability could materially suffer. The rates VIYI is able to charge for services and solutions are affected by a number of factors, including:

In addition, VIYI’s profitability with respect to services and solutions for new technologies may be different when compared to the profitability of VIYI’s current business, due to factors such as the use of alternative pricing, the mix of work and the number of service providers, among others.

The competitive environment the central processing algorithm services industry in the PRC affects VIYI’s ability to obtain favorable pricing in a number of ways, any of which could have a material negative impact on its results of operations. The less VIYI is able to differentiate and/or clearly convey the value of VIYI’s services and solutions, the more risk VIYI faces in terms of its services and solutions will be seen as commodities, and price will become the driving factor in selecting a service provider. In addition, the introduction of new services or products by competitors could reduce VIYI’s ability to obtain favorable pricing for the services or products that VIYI offers. Competitors may be willing, at times, to price contracts lower than VIYI in an effort to enter new markets or increase market share. Further, if competitors develop and implement methodologies that yield greater efficiency and productivity, they may be better positioned to offer similar services at lower prices. As such, failure to adopt a sufficient pricing policy or adjust its pricing policy in a timely and effective manner could adversely and materially affect VIYI’s competitive position in the industry, which could adversely and materially affect VIYI’s operations and financial conditions.

VIYI makes significant investments in research and development of new products and services that may not achieve expected returns.

VIYI has made and will continue to make significant investments in research, development, and marketing for existing products, services, and technologies, as well as new technology or new applications of existing technology. Investments in new technology are speculative. Commercial success depends on many factors, including but not limited to, innovativeness, developer support, and effective distribution and marketing. There is no assurance that VIYI will be rewarded from its investments in developing new services and products. If VIYI’s customers do not perceive its latest offerings as providing significant new functionality or other value, they may reduce their purchases of services or products, thus unfavorably affecting revenue and profits. VIYI may not achieve significant revenue from new products and services, or new applications of existing products and services, for several years, if at all. New products and services may not be profitable, and even if they are profitable, operating margins for some new products, services and businesses may not be as high as the margins VIYI has experienced historically. Furthermore, developing new technologies is complex and unpredictable, which can require long development and testing periods. Significant delays in new releases or significant problems in creating new products or offering new services could adversely affect VIYI’s revenue and profits.

VIYI requires a significant amount of capital to fund its research and development investments. If VIYI cannot obtain sufficient capital on favorable terms or at all, its business, financial condition and prospects may be materially and adversely affected.

Operating VIYI, its subsidiaries’ business requires significant, continuous investment in acquiring, maintaining and upgrading contents, services and technologies. Historically, VIYI has financed its operations primarily with net cash generated from operating activities, financial support from shareholders and equity financings and loans from third-parties. As part of VIYI’s growth strategy, VIYI plans to continue investing substantial capital in research and development activities in the future, which may require VIYI to obtain additional equity or debt financing. VIYI’s ability to obtain additional financing in the future is subject to a number of uncertainties, including but not limited to those relating to:

Although VIYI expects to rely on net cash provided by operating activities and financing through capital markets for liquidity needs as VIYI’s business continues to grow and after it becomes a public company, there can be no assurances that VIYI will be successful in its efforts to diversify sources of liquidity. If VIYI raises additional funds through future issuances of equity or convertible debt securities, VIYI’s existing shareholders could suffer significant dilution, and any new equity securities VIYI issues could have rights, preferences and privileges superior to those of holders of VIYI’s ordinary shares. Any debt financing that VIYI secures in the future could involve restrictive covenants relating to VIYI’s capital raising activities and other financial and operational matters, including the ability to pay dividends. This may make it more difficult for VIYI to obtain additional capital to fund its research and development, and pursue business opportunities, including potential acquisitions. If VIYI is unable to obtain sufficient capital to meet capital needs, then it may not be able to implement growth strategies, which may cause VIYI’s business, financial condition and general prospects to be materially and adversely affected.

VIYI’s success depends on its ability to attract, hire, retain and motivate key management personnel and highly skilled employees.

VIYI’s success is largely attributable to the continued commitment and contribution of VIYI’s directors and key senior management personnel. Their extensive knowledge and experience in the central processing algorithm service industry as well as their established relationships with VIYI’s customers, are vital to VIYI’s business. There are no assurances that VIYI will be able to retain these key personnel, and the loss of any of them without suitable and timely replacements, or the inability to attract and retain qualified personnel may adversely affect VIYI’s business, results of operations, financial position and general prospects.

As of December 31, 2021, VIYI had a total number of 163 employees. VIYI believes that its future success depends on VIYI’s continued ability to attract, hire, retain and motivate qualified and skilled employees, as they are critical in improving VIYI’s infrastructure and technologies and optimizing its operations. Competition for recruitment of highly skilled professionals is intense, which could also increase costs to attract and retain talented employees. VIYI may not be able to hire and retain skilled employees at compensation levels consistent with VIYI’s existing compensation level and structure. Some of the companies with which VIYI competes for experienced employees may have greater resources than VIYI does and may be able to offer more attractive terms of employment. In addition, VIYI invests significant time and resources in training employees to ensure their competitiveness, which increases these employees’ value to competitors who may seek to recruit them. If VIYI fails to retain these employees, VIYI could incur significant expenses in hiring and training new employees, and VIYI’s ability to provide services consistently could diminish, resulting in a material adverse effect on VIYI’s business and ability to sustain profitability. Moreover, if any member of VIYI’s management team or any of its other key personnel joins a competitor or forms a competing business, VIYI’s trade secrets and know-hows may leak which could have a material adverse effect on its business.

VIYI’s business depends substantially on the market recognition of its brand and negative media coverage could adversely affect VIYI’s business.

VIYI believes that enhancing its brand and extending its customer base are cornerstones to sustaining its competitive advantages. Negative publicity about VIYI and its business, shareholders, affiliates, directors, officers, and other employees, as well as the industry in which VIYI operates, could be devastating and could materially and adversely affect the public perception of VIYI’s brand, and in turn, reduce the sales of its products and services. Negative publicity concerning could be related to a wide variety of matters, including:

In addition to traditional media, there has been an increasing use of social media platforms and similar devices in China, including instant messaging applications, social media websites and other forms of internet-based communications that provide individuals with access to a broad audience of users and other interested persons. The availability of information on instant messaging applications and social media platforms is virtually immediate as its impact without affording VIYI an opportunity for redress or correction. The opportunity for dissemination of information, including inaccurate information, is seemingly limitless and readily available. Information concerning VIYI, shareholders, directors, officers and employees may be posted on such platforms at any time. The risks associated with any such negative publicity or incorrect information cannot be eliminated entirely or mitigated and may materially harm VIYI’s reputation, business, financial condition and results of operations.

VIYI’s failure to protect intellectual property rights may undermine its competitive position.

VIYI believes that its patents, copyrights, trademarks and other intellectual property are essential to the success of VIYI. VIYI depends to a large extent on the ability to develop and maintain the intellectual property rights relating to VIYI’s central processing algorithm solutions and products. VIYI has devoted considerable time and energy to the development and improvement of software, middleware, websites, and intellectual property.

VIYI relies primarily on a combination of patents, copyrights, trademarks and trade secrets laws, and contractual restrictions for the protection of the intellectual property used in VIYI’s business. Nevertheless, these provide only limited protection and the actions VIYI takes to protect intellectual property rights may not be adequate. VIYI’s trade secrets may become known or be independently discovered by competitors. VIYI may have no rights or limited rights to stop others’ use of VIYI’s information, including intellectual property. Moreover, to the extent that VIYI’s employees or third parties with whom VIYI does business use intellectual property owned by others in their work for VIYI, disputes may arise as to the rights to such intellectual property. Furthermore, it is often difficult to maintain and enforce intellectual property rights in China. Statutory laws and regulations are subject to judicial interpretation and enforcement, and may not be applied consistently due to the lack of clear guidance on statutory interpretation. Contractual restrictions may be breached by counterparties, and there may not be adequate remedies available to VIYI for any such breach. Accordingly, VIYI may not be able to effectively protect intellectual property rights or to enforce VIYI’s contractual rights in China. Preventing any unauthorized use of VIYI’s intellectual property is difficult and costly and the steps VIYI takes may be inadequate to prevent the misappropriation of company intellectual property. In the event that VIYI resorts to litigation to enforce intellectual property rights, such litigation could result in substantial costs and a diversion of VIYI’s managerial and financial resources. VIYI cannot provide assurance that VIYI will prevail in such litigation. Any failure in protecting or enforcing VIYI’s intellectual property rights could have a material adverse effect on its business, financial condition and results of operations.

VIYI’s services or solutions could infringe upon the intellectual property rights of others or VIYI might lose its ability to utilize the intellectual property of others.

VIYI cannot be sure that its services and solutions do not infringe on the intellectual property rights of third parties, and these third parties could claim that VIYI or its clients are infringing upon their intellectual property rights. These claims could harm VIYI’s reputation, cause VIYI to incur substantial costs or prevent it from offering some services or solutions in the future. Any related proceedings could require VIYI to expend significant resources over an extended period of time. Any claims or litigation in this area could be time-consuming and costly, damage VIYI’s reputation and/or require it to incur additional costs to obtain the right to continue to offer a service or solution to VIYI’s customers. If VIYI cannot secure this right at all or on reasonable terms, or if it cannot substitute alternative technology, then VIYI’s results of operations could be materially adversely affected. The risk of infringement claims against VIYI may increase as VIYI expands upon its industry software solutions.

Additionally, in recent years, individuals and firms have purchased intellectual property assets in order to assert claims of infringement against technology providers and customers that use such technology. Any such action naming VIYI or its clients could be costly to defend or lead to an expensive settlement or judgment against VIYI. Moreover, such an action could result in an injunction being ordered against VIYI’s client or its services or operations, causing further damages.

In addition, VIYI relies on third-party software in providing some of VIYI’s services and solutions. If VIYI loses its ability to continue using such software for any reason, including in the event that the software is found to infringe the rights of others, VIYI will need to obtain substitute software or seek alternative means of obtaining the technology necessary to continue to provide such services and solutions. VIYI’s inability to replace such software, or to replace such software in a timely or cost-effective manner, could materially adversely affect VIYI’s results of operations. In addition, the application and interpretation of intellectual property right laws as well as the procedures and standards for granting trademarks, patents, copyrights, know-how and other intellectual property rights are constantly evolving and may be uncertain, so VIYI cannot assure you that the courts or regulatory authorities will agree with VIYI’s legal analysis. If VIYI is ruled to have violated the intellectual property rights of a third party, VIYI may be liable for infringement activities, or may be prohibited from using the intellectual property rights, and VIYI may incur licensing fees or be forced to develop alternatives. In this case, VIYI’s business and financial condition may be materially and adversely affected.

VIYI may not be able to protect its source code from copying if there is an unauthorized disclosure.

Source code, the detailed program commands for VIYI’s middleware and software programs and solutions, is critical to VIYI’s business. Although VIYI licenses portions of its application and operating system source code to several licensees, VIYI takes significant measures to protect the secrecy of large portions of VIYI’s source code. If VIYI’s source code leaks, VIYI might lose future trade secret protection for that code. It may then become easier for third parties to compete with VIYI’s products by copying functionality, which could adversely affect VIYI’s revenue and operating margins.

Third parties may register trademarks or domain names or purchase internet search engine keywords that are similar to VIYI’s trademarks, brand or websites, or misappropriate VIYI’s data and copy VIYI’s platform, all of which could cause confusion to VIYI’s users, divert online customers away from VIYI’s products and services or harm its reputation.

To divert potential customers from VIYI to such competitors’ or third parties’ websites or platforms, competitors and other third parties may purchase (i) trademarks that are similar to VIYI’s trademarks and (ii) keywords that are confusingly similar to VIYI’s brand or websites in internet search engine advertising programs and in the header and text of the resulting sponsored links or advertisements in order to divert potential customers from VIYI to such competitors’ or third parties’ websites or platforms. Preventing such unauthorized use is inherently difficult. If VIYI is unable to prevent such unauthorized use, competitors and other third parties may continue to drive potential customers away from VIYI’s platform to competing, irrelevant or potentially offensive platform, which could harm VIYI’s reputation and cause VIYI to lose revenue.

VIYI’s business is highly dependent on the proper functioning and improvement of its information technology systems and infrastructure. VIYI’s business and operating results may be harmed by service disruptions, or by VIYI’s failure to timely and effectively scale up and adjust VIYI’s existing technology and infrastructure.

VIYI’s business depends on the continuous and reliable operation of VIYI’s information technology (“IT”) systems. VIYI’s IT systems are vulnerable to damage or interruption as a result of fires, floods, earthquakes, power losses, telecommunications failures, undetected errors in software, computer viruses, hacking and other attempts to harm VIYI’s IT systems. Disruptions, failures, unscheduled service interruptions or a decrease in connection speeds could damage VIYI’s reputation and cause VIYI’s customers and end-users to migrate to its competitors’ platforms. If VIYI experiences frequent or constant service disruptions, whether caused by failures of VIYI’s own IT systems or those of third-party service providers, then VIYI’s user experience may be negatively affected, which in turn may have a material and adverse effect on VIYI’s reputation and business. VIYI may not be successful in minimizing the frequency or duration of service interruptions. As the number of VIYI’s end-users increases and more user data are generated on VIYI’s platform, it may be required to expand and adjust technology and infrastructure to continue to reliably store and process content.

VIYI’s operations depend on the performance of the Internet infrastructure and fixed telecommunications networks in China, which may experience unexpected system failure, interruption, inadequacy or security breaches.

Almost all access to the Internet in China is maintained through state-owned telecommunication operators under the administrative control and regulatory supervision of the Ministry of Industry and Information Technology, or the MIIT. Moreover, VIYI primarily relies on a limited number of telecommunication service providers to provide VIYI with data communications capacity through local telecommunications lines and Internet data centers to host VIYI’s servers. VIYI has limited access to alternative networks or services in the event of disruptions, failures or other problems with China’s Internet infrastructure or the fixed telecommunications networks provided by telecommunication service providers. Web traffic in China has experienced significant growth during the past few years. Effective bandwidth and server storage at Internet data centers in large cities such as Beijing and Shenzhen are scarce. With the expansion of VIYI’s business, it may be required to upgrade technology and infrastructure to keep up with the increasing traffic on its platform. VIYI cannot assure you that the Internet infrastructure and the fixed telecommunications networks in China will be able to support the demands associated with the continued growth in Internet usage. If VIYI cannot increase its capacity to deliver online services, then it may not be able to expand its customer base, and the adoption of VIYI’s services may be hindered, which could adversely impact its business and profitability.

In addition, VIYI has no control over the costs of the services provided by telecommunication service providers. If the prices VIYI pays for telecommunications and Internet services rise significantly, VIYI’s results of operations may be materially and adversely affected. Furthermore, if Internet access fees or other charges to Internet users increase, some users may be prevented from accessing the mobile Internet and thus cause the growth of mobile Internet users to decelerate. Such deceleration may adversely affect VIYI’s ability to continue to expand VIYI’s user base.

VIYI uses third-party services and technologies in connection with VIYI’s business, and any disruption to the provision of these services and technologies to VIYI could result in adverse publicity and a slowdown in the growth of VIYI’s users, which could materially and adversely affect VIYI’s business, financial condition and results of operations.

VIYI’s business partially depends on services provided by, and relationships with, various third parties. Some third-party software VIYI uses in its operations is currently publicly available and free of charge. If the owner of any such software decides to charge users or no longer makes the software publicly available, then VIYI may need to incur significant costs to obtain licensing, find replacement software or develop it on VIYI’s own. If VIYI is unable to obtain licensing, find or develop replacement software at a reasonable cost, or at all, VIYI’s business and operations may be adversely affected.

VIYI exercises no control over the third parties with whom VIYI has business arrangements. If such third parties increase their prices, fail to provide their services effectively, terminate their service or agreements or discontinue their relationships with VIYI, then VIYI could suffer service interruptions, reduced revenues or increased costs, any of which may have a material adverse effect on VIYI’s business, financial condition and results of operations.

VIYI’s insurance policies may not provide adequate coverage for all claims associated with its business operations.

VIYI maintains various insurance policies, such as group personal accident insurance and corporate employee benefits insurance. However, VIYI’s insurance coverage is still limited in terms of amount, scope and benefit. Insurance companies in China offer limited business insurance products. VIYI does not have any business liability or disruption insurance coverage for VIYI’s operations in China. Any business disruption may result in VIYI’s incurring substantial costs and the diversion of VIYI’s resources. Any uninsured business disruption, litigation or legal proceedings or natural disasters, such as epidemics, pandemics or earthquakes, or other events beyond VIYI’s control could result in substantial costs and the diversion of VIYI’s management’s attention. If VIYI was to be held liable for uninsured losses or amounts and claims for insured losses exceeding the limits of its insurance coverage, then VIYI’s business, financial condition, and results of operations may be materially and adversely affected as a result.

VIYI may be subject to claims, disputes or legal proceedings in the ordinary course of its business. If the outcome of these proceedings is unfavorable to VIYI, then VIYI’s business, results of operations and financial condition could be adversely affected.

VIYI may be subject to claims, disputes, or legal proceedings in the ordinary course of its business from time to time, which could adversely affect VIYI’s business, results of operations and financial condition. VIYI may receive formal and informal inquiries from governmental authorities and regulators regarding VIYI’s compliance with applicable laws and regulations, many of which are evolving and subject to interpretation. Claims arising out of actual or alleged violations of laws could be asserted against VIYI by VIYI’s employees, customers, media partners, competitors, governmental entities in civil or criminal investigations and proceedings or other third parties. These claims could be asserted under a variety of laws, including but not limited to advertising laws, Internet information services laws, intellectual property laws, unfair competition laws, data protection and privacy laws, labor and employment laws, securities laws, real estate laws, tort laws, contract laws, property laws and employee benefit laws. VIYI may also be subject to lawsuits due to actions by VIYI’s media partners or advertising customers.

There can be no guarantee that VIYI will be successful in defending itself in legal and arbitration actions or in asserting VIYI’s rights under various laws. If the outcome of these proceedings is unfavorable to VIYI, then VIYI’s business, results of operations and financial conditions could be adversely affected. Even if VIYI is successful in its attempt to defend itself in legal and arbitration actions or to assert VIYI’s rights under various laws, enforcing VIYI’s rights against the various parties involved may be expensive, time-consuming and ultimately futile. These actions

may expose VIYI to negative publicity, substantial monetary damages and legal defense costs, injunctive relief, and criminal and civil fines and penalties, including but not limited to suspension or revocation of VIYI’s licenses to conduct business.

VIYI may need additional capital to support or expand its business, and VIYI may be unable to obtain such capital in a timely manner or on acceptable terms, if at all.

Although VIYI believes that VIYI’s anticipated cash flows from operating activities, together with cash on hand, will be sufficient to meet VIYI’s anticipated working capital requirements and capital expenditures in the ordinary course of business for the next twelve months, VIYI cannot assure you this will be the case. VIYI may also need additional cash resources in the future if it pursues opportunities for investments, acquisitions or similar actions. If VIYI determines that its cash requirements exceed the amount of cash and cash equivalents VIYI has on hand at the time, VIYI may seek to issue equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to VIYI’s shareholding. The incurrence of indebtedness would result in increased fixed obligations and could result in operational and financial covenants that would restrict VIYI’s operations. VIYI has historically used bank borrowings to partially finance operations. VIYI cannot assure you that additional financing will be available in amounts sufficient or on terms acceptable to VIYI, if at all.

New Venus will be a “controlled company” within the meaning of the applicable Nasdaq listing rules and, as a result, will qualify for exemptions from certain corporate governance requirements. If New Venus relies on these exemptions, you will not have the same protections afforded to shareholders of companies that are subject to such requirements.

Upon the closing of this Business Combination, WiMi will control 63.32% of the voting power of New Venus outstanding ordinary shares. As a result, New Venus will be a “controlled company” within the meaning of applicable Nasdaq Stock Market Rules. Under these rules, a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company is a “controlled company.” For so long as New Venus remains a controlled company under that definition, it is permitted to elect to rely, and may rely, on certain exemptions from corporate governance rules, including an exemption from the rule that a majority of New Venus’ board of directors must be independent directors or that New Venus must establish a nominating committee and a compensation committee composed entirely of independent directors. As a result, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.

VIYI’s business may be materially and adversely affected by the effects of natural disasters, health epidemics or similar situation. In particular, the COVID-19 pandemic has already and may continue to cause negative impacts to the VIYI’s business, results of operations and financial condition.

VIYI’s business could be materially and adversely affected by natural disasters, such as earthquakes, floods, blizzards, typhoons or fire accidents, epidemics such as avian flu, swine flu, Severe Acute Respiratory Syndrome (or SARS), Ebola, Zika, COVID-19, or other events, such as acts of war, terrorism, environmental accidents, power shortages or communication interruptions.

Since the beginning of 2020, the COVID-19 pandemic has caused temporary closures of shops and facilities in China and around the world. VIYI’s business growth in 2021 was negatively affected as a result of the COVID-19 pandemic, and VIYI incurred additional implementation costs and general and administrative expenses, which resulted in a decrease in VIYI’s operating income and net income in 2020. As COVID-19 has negatively affected the broader Chinese economy and the global economy, China may continue to experience lower domestic consumption, higher unemployment, severe disruptions to exporting of goods to other countries and greater economic uncertainty, all of which may materially and adversely affect VIYI’s business and results of operations. Potential impacts of the COVID-19 pandemic include, but not limited to the following aspects:

Due to the uncertain nature of the COVID-19 pandemic, it is impossible to reasonably estimate the financial impact brought by the outbreak and countermeasures of COVID-19 pandemic for the time being. While most of the restrictions on movement within China have been relaxed as of the date of this proxy statement, there is great uncertainty as to the future progress of the pandemic. Relaxation of restrictions on economic and social life may lead to new cases, which may lead to re-imposition of restrictions. Consequently, the COVID-19 pandemic may materially adversely affect VIYI’s business, financial condition and results of operations in 2021. During such an epidemic outbreak, China may adopt certain hygiene measures, those restrictive measures adversely affected and slowed down the national economic development during that period.

As a result of the ongoing COVID-19 pandemic, VIYI’s operation is expected to experience slowdown. VIYI’s business could be materially and adversely affected if the economic slowdown or suspension continues for a long period.

For example, the effects of a subvariant of the Omicron variant of COVID-19, which may spread faster than the original Omicron variant, as well as the effects of any new variants and subvariants which may develop, including any actions taken by governments, may have the effect of increasing the already-existing supply chain problems or slowing VIYI’s sales. Moreover, China’s policy of effecting closures to avoid infections, including the recent lockdown in many provinces and municipalities in China, could affect VIYI’s results of operations.

The extent to which this pandemic impacts VIYI’s results of operations will depend on future developments which are highly uncertain and unpredictable, including new outbreaks of COVID-19, the severity of the virus infection, the effectiveness and availability of vaccines, and future actions VIYI or the authorities may take in response to these developments.

VIYI may be materially and adversely affected by the complexity, uncertainties and changes in PRC regulation of the Internet industry and companies.

In the opinion of VIYI’s PRC counsel, VIYI’s subsidiaries in the PRC currently have obtained the necessary permits and licenses to operate its business in China. However, the PRC government extensively regulates the Internet industry, including foreign ownership of, and the licensing and permit requirements pertaining to, companies in the Internet industry. These Internet-related laws and regulations are relatively new and evolving, and their interpretation and enforcement involve significant uncertainty. As a result, in certain circumstances it may be difficult to determine what actions or omissions may be deemed to be in violations of applicable laws and regulations. Issues, risks and uncertainties relating to PRC regulations of the Internet business include, but are not limited to, the following:

regulations and policies and how they may affect VIYI. Further, new laws, regulations or policies may be promulgated or announced that will regulate Internet activities, including online video and online advertising businesses. If these new laws, regulations or policies are promulgated, additional licenses may be required for VIYI’s operations. If VIYI’s operations do not comply with these new regulations after they become effective, or if VIYI fails to obtain any licenses required under these new laws and regulations, VIYI could be subject to penalties, and VIYI’s business could be disrupted.

The interpretation and application of existing PRC laws, regulations and policies and possible new laws, regulations or policies relating to the Internet industry have created substantial uncertainties regarding the legality of existing and future foreign investments in, and the businesses and activities of, Internet businesses in China, including VIYI’s business. There are also risks that VIYI may be found to violate the existing or future laws and regulations given the uncertainty and complexity of China’s regulation of Internet business.

VIYI’s business generates and processes a large quantity of data. VIYI faces risks inherent in handling and protecting large volume of data. In particular, VIYI faces a number of challenges relating to data VIYI collects through its game distribution platform, including:

Governments around the world, including the PRC government, have enacted or are considering legislation related to online businesses. There may be an increase in legislation and regulation related to the collection and use of anonymous internet user data and unique device identifiers, such as IP address or mobile unique device identifiers, and other data protection and privacy regulation. The PRC regulatory and enforcement regime with regard to data security and data protection is evolving. VIYI may be required by Chinese governmental authorities to share personal information and data that VIYI collects to comply with PRC laws relating to cybersecurity. All these laws and regulations may result in additional expenses to VIYI and any non-compliance may subject VIYI to negative publicity which could harm its reputation and negatively affect the trading price of VIYI’s ordinary shares. There are also uncertainties with respect to how these laws will be implemented in practice. PRC regulators have been increasingly focused on regulation in the areas of data security and data protection. VIYI expects that these areas will receive greater attention and focus from regulators, as well as attract continued or greater public scrutiny and attention going forward, which could increase VIYI’s compliance costs and subject it to heightened risks and challenges associated with data security and protection. If VIYI is unable to manage these risks, VIYI could become subject to penalties, fines, suspension of business and revocation of required licenses, and VIYI’s reputation and results of operations could be materially and adversely affected. In addition, regulatory authorities around the world have recently adopted or are considering a number of legislative and regulatory proposals concerning data protection. These legislative and regulatory proposals, if adopted, and the uncertain interpretations and application thereof could, in addition to the possibility of fines, result in an order requiring that VIYI change its data practices, which could have an adverse effect on VIYI’s business and results of operations.

VIYI may be liable for improper use or appropriation of personal information provided directly or indirectly by its customers or end users.

VIYI may become subject to a variety of laws and regulations in the PRC regarding privacy, data security, cybersecurity, and data protection. These laws and regulations are continuously evolving and developing. The scope and interpretation of the laws that are or may be applicable to VIYI are often uncertain and may be conflicting, particularly with respect to foreign laws. In particular, there are numerous laws and regulations regarding privacy

and the collection, sharing, use, processing, disclosure, and protection of personal information and other user data. Such laws and regulations often vary in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions.

VIYI expects to obtain information about various aspects of its operations as well as regarding its employees and third parties. VIYI also maintains information about various aspects of its operations as well as regarding its employees. The integrity and protection of VIYI’s customer, employee and company data is critical to its business. VIYI’s customers, end users and employees expect that VIYI will adequately protect their personal information. VIYI is required by applicable laws to keep strictly confidential the personal information that it collects, and to take adequate security measures to safeguard such information.

The PRC Criminal Law, as amended by its Amendment 7 (effective on February 28, 2009) and Amendment 9 (effective on November 1, 2015), prohibits institutions, companies and their employees from selling or otherwise illegally disclosing a citizen’s personal information obtained during the course of performing duties or providing services or obtaining such information through theft or other illegal ways. On November 7, 2016, the Standing Committee of the PRC National People’s Congress issued the Cyber Security Law of the PRC, or Cyber Security Law, which became effective on June 1, 2017.

Pursuant to the Cyber Security Law, network operators must not, without users’ consent, collect their personal information, and may only collect users’ personal information necessary to provide their services. Providers are also obliged to provide security maintenance for their products and services and shall comply with provisions regarding the protection of personal information as stipulated under the relevant laws and regulations.

The Civil Code of the PRC (issued by the PRC National People’s Congress on May 28, 2020 and effective from January 1, 2021) provides main legal basis for privacy and personal information infringement claims under the Chinese civil laws. PRC regulators, including the Cyberspace Administration of China, MIIT, and the Ministry of Public Security have been increasingly focused on regulation in the areas of data security and data protection.

The PRC regulatory requirements regarding cybersecurity are constantly evolving. For instance, various regulatory bodies in China, including the Cyberspace Administration of China, the Ministry of Public Security and the SAMR, have enforced data privacy and protection laws and regulations with varying and evolving standards and interpretations. In April 2020, the Chinese government promulgated Cybersecurity Review Measures, which came into effect on June 1, 2020. According to the Cybersecurity Review Measures, operators of critical information infrastructure must pass a cybersecurity review when purchasing network products and services which do or may affect national security.

In November 2016, the Standing Committee of China’s National People’s Congress passed China’s first Cybersecurity Law (“CSL”), which became effective in June 2017. The CSL is the first PRC law that systematically lays out the regulatory requirements on cybersecurity and data protection, subjecting many previously under-regulated or unregulated activities in cyberspace to government scrutiny. The legal consequences of violation of the CSL include penalties of warning, confiscation of illegal income, suspension of related business, winding up for rectification, shutting down the websites, and revocation of business license or relevant permits. In April 2020, the Cyberspace Administration of China and certain other PRC regulatory authorities promulgated the Cybersecurity Review Measures, which became effective in June 2020. Pursuant to the Cybersecurity Review Measures, operators of critical information infrastructure must pass a cybersecurity review when purchasing network products and services which do or may affect national security. On July 10, 2021, the Cyberspace Administration of China issued a revised draft of the Measures for Cybersecurity Review for public comments (“Draft Measures”), which required that, in addition to “operator of critical information infrastructure,” any “data processor” carrying out data processing activities that affect or may affect national security should also be subject to cybersecurity review, and further elaborated the factors to be considered when assessing the national security risks of the relevant activities, including, among others, (i) the risk of core data, important data or a large amount of personal information being stolen, leaked, destroyed, and illegally used or exited the country; and (ii) the risk of critical information infrastructure, core data, important data or a large amount of personal information being affected, controlled, or maliciously used by foreign governments after listing abroad. The Cyberspace Administration of China has said that under the proposed rules companies holding data on more than 1,000,000 users must now apply for cybersecurity approval when seeking listings in other nations because of the risk that such data and personal information could be “affected, controlled, and maliciously exploited by foreign governments.” The cybersecurity review will also investigate the potential national security risks from overseas IPOs.

On December 28, 2021, the Cyberspace Administration of China jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021) which took effect on February 15, 2022 and replaced the former Measures for Cybersecurity Review (2020). Measures for Cybersecurity Review (2021) stipulates that operators of critical information infrastructure purchasing network products and services, and online platform operator (together with the operators of critical information infrastructure, the “Operators”) carrying out data processing activities that affect or may affect national security, shall conduct a cybersecurity review, any online platform operator who controls more than one million users’ personal information must go through a cybersecurity review by the cybersecurity review office if it seeks to be listed in a foreign country. Since VIYI is not an operator, it does not control the personal information of more than one million users and does not collect data that affects or could affect national security. In the foreseeable future, VIYI will not collect personal information of more than one million users or collect data that affects or may affect national security, and VIYI will not be required to apply for a cybersecurity review under the Cybersecurity Review Measures (2021). As of the date of this proxy statement, VIYI has not received any notification from any PRC government agency regarding any requirement by VIYI to apply for approval for this Business Combination. Further, if the enacted version of the Measures for Cybersecurity Review mandates clearance of cybersecurity review and other specific actions to be completed by companies like VIYI, VIYI faces uncertainties as to whether such clearance can be timely obtained, or at all.

Since the Cybersecurity Review Measures are relativity new, the implementation and interpretation are not yet clear. There are uncertainties about how such regulations will affect VIYI and its listing on Nasdaq. In the event that the Cyberspace Administration of China determines that VIYI is subject to these regulations, VIYI may be required to be delisted from Nasdaq and VIYI may be subject to fines and penalties.

On June 10, 2021, the Standing Committee of the NPC promulgated the PRC Data Security Law, which will take effect on September 1, 2021. The Data Security Law also sets forth the data security protection obligations for entities and individuals handling personal data, including that no entity or individual may acquire such data by stealing or other illegal means, and the collection and use of such data should not exceed the necessary limits The costs of compliance with, and other burdens imposed by, CSL and any other cybersecurity and related laws may limit the use and adoption of VIYI’s products and services and could have an adverse impact on VIYI’s business.

The new PRC Data Security Law was enacted in September 2021 and VIYI is not subject to the cybersecurity review by the CAC for this offering, given that: (i) VIYI’s products and services are offered not directly to individual users but through VIYI’s business customers; (ii) VIYI does not possess a large amount of personal information in VIYI’s business operations; and (iii) data processed in VIYI’s business does not have a bearing on national security and thus may not be classified as core or important data by the authorities. However, there remains uncertainty as to how the Draft Measures will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Draft Measures. If any such new laws, regulations, rules, or implementation and interpretation comes into effect, VIYI will take all reasonable measures and actions to comply and to minimize the adverse effect of such laws on VIYI.

On August 20, 2021, the Standing Committee of the NPC approved the Personal Information Protection Law (“PIPL”), which will become effective on November 1, 2021. The PIPL regulates collection of personal identifiable information and seeks to address the issue of algorithmic discrimination. Companies in violation of the PIPL may be subject to warnings and admonishments, forced corrections, confiscation of corresponding income, suspension of related services, and fines. VIYI offers its central processing algorithm services mainly to corporate clients and has limited interactions with individual end-users, which means VIYI’s potential access or exposure to end-users’ personal identifiable information is limited. However, in the event VIYI inadvertently accesses or becomes exposed to end-users’ personal identifiable information, through its corporate clients’ end-user-facing applications which access or store end users’ personal identifiable information, then VIYI may face heightened exposure to the PIPL.

VIYI cannot assure you that PRC regulatory agencies, including the CAC, would take the same view as VIYI does, and there is no assurance that VIYI can fully or timely comply with such laws. In the event that VIYI is subject to any mandatory cybersecurity review and other specific actions required by the CAC, VIYI faces uncertainty as to whether any clearance or other required actions can be timely completed, or at all. Given such uncertainty, VIYI may be further required to suspend VIYI’s relevant business, shut down VIYI’s website, or face other penalties, which could materially and adversely affect its business, financial condition, and results of operations.

As of the date of this Proxy Statement, the three Hong Kong subsidiaries of VIYI do not have any material operation in Hong Kong and they have not collected, stored, or managed any personal information in Hong Kong. Therefore, VIYI has concluded that currently it does not expect that laws and regulations in Mainland China on data security, data protection, or cybersecurity to be applied to its Hong Kong subsidiaries or that the oversight of the Cyberspace Administration of China will be extended to its operations outside of Mainland China. In Hong Kong, the Personal Data (Privacy) Ordinance (Cap. 486) of Hong Kong), or the PDPO, applies to data users, that control the collection, holding, processing or use of personal data in Hong Kong. VIYI’s Hong Kong subsidiaries are subject to the general requirements under PDPO including the need to obtain the prescribed consent of the data subject and to take all practicable steps to protect the personal data held by data users against unauthorized or accidental access, loss or use. Breaches of the PDPO may lead to a variety of civil and criminal sanctions including fines and imprisonment. In addition, data subjects have a right to bring proceedings in court to seek compensation for damage. VIYI cannot guarantee that VIYI is, or will be, in compliance with all applicable international regulations as they are enforced now or as they evolve. As of the date of this Proxy Statement, the three Hong Kong subsidiaries of VIYI do not have any material operation in Hong Kong and therefore, VIYI believes that the PDPO will not be applied to VIYI’s Hong Kong subsidiaries.

VIYI, its subsidiaries and historical VIE have a limited customer base and depend on a small number of customers for a significant portion of revenues which may result in heightened concentration risk.

Due to the nature of VIYI’s business and its limited operating history, VIYI, its subsidiaries, and the historical VIE, have a limited customer base and have depended on a small number of customers for a significant portion of revenues. For the years ended December 31, 2020 and 2021, and for the six months ended June 30, 2022, VIYI and the historical VIE had 157, 196 and 198 customers who engaged VIYI and the historical VIE to provide central processing algorithm services, respectively. For the years ended December 31, 2020 and 2021, and for the six months ended June 30, 2022, VIYI and the historical VIE derived 25.2%, 23.9% and 29.8% of VIYI and the historical VIE’s total revenues from two largest, a single largest and a single largest customers, respectively. In terms of accounts receivable for the years ended December 31, 2020 and 2021, and the six months ended June 30, 2022, VIYI and the historical VIE derived 58.6%, 45.2% and 22.8% of VIYI and the historical VIE’s accounts receivable from three largest, three largest and one largest customers, respectively.

VIYI and the historical VIE’s ability to maintain close relationships with its top customers is essential to the growth and profitability of VIYI’s business. If VIYI fails to retain these top customers in any particular period, or if a large customer enters into fewer engagements with VIYI and the historical VIE, or fails to enter into any engagements with VIYI and the historical VIE, or if VIYI and the historical VIE fails to develop additional major customers, or if VIYI and the historical VIE fails to develop additional major customers, then VIYI and the historical VIE’s revenue could decline, which may adversely affect VIYI’s results of operations.

VIYI, its subsidiaries and the historical VIE depend on a limited number of vendors for a significant portion of its purchase which may result in heightened concentration risk.

VIYI, its subsidiaries, and the historical VIE also conduct business with a limited number of vendors. For the years ended December 31, 2020 and 2021, and for the six months ended June 30, 2022, 73.5%, 61.2% and 11.8% of VIYI and the historical VIE’s total purchases were from four, three and one vendors in 2020, 2021 and six months ended 2022. In terms of accounts payable for the years ended December 31, 2020, 2021 and for the six months ended June 30, 2022, 93.6%, 95.8% and 72.4% of VIYI and the historical VIE’s accounts payable were from three, six and three vendors in 2020, 2021, and the six months ended June 30, 2022, respectively.

VIYI’s financial results could be materially and adversely affected if any one supplier fails to fulfill its contractual obligations, or if VIYI is unable to find other suppliers to provide the same level of supplies. In addition, VIYI cannot assure you that performance by third-party vendors will be satisfactory, and if they under-perform, it will have a material adverse effect on the cash flows or profitability of VIYI’s business.

Substantial uncertainties exist with respect to the enactment timetable, interpretation and implementation of PRC Foreign Investment Law and how it may impact the viability of VIYI’s current corporate structure, corporate governance and business operations.

In March 2019, the Standing Committee of the National People’s Congress of the PRC passed the Foreign Investment Law of the People’s Republic of China (“Foreign Investment Law”). Among other things, the Foreign Investment Law defines the “foreign investment” as the investment activities in China conducted by foreign individuals, enterprises and other organizations (collectively, the “Foreign Investors”) in a direct or indirectly manner, including any of the following circumstances: (1) the foreign investor establishes a foreign-invested enterprise within the territory of China, independently or jointly with any other investor; (2) the foreign investor acquires shares, equities, property shares or any other similar rights and interests of an enterprise within the territory of China; (3) the foreign investor makes investment to initiate a new project within the territory of China, independently or jointly with any other investor; and (4) the foreign investor makes investment in any other way stipulated by laws, administrative regulations or provisions of the State Council. The Foreign Investment Law leaves uncertainty with respect to whether Foreign Investors control PRC onshore variable interest entities via contractual arrangements will be recognized as “foreign investment.” PRC governmental authorities will administrate foreign investment by applying the principal of pre-entry national treatment together with a “negative list” (the “Negative List”, which shall be promulgated by or promulgated with approval by the State Counsel), to be specific, Foreign Investors are prohibited from making any investments in the fields which are catalogued into prohibited industries for foreign investment based on the Negative List, while Foreign Investors are allowed to make investments in the restricted industries provided that all the requirements and conditions as set forth in the Negative List have been satisfied; when Foreign Investors make investments in the fields other than those included in the Negative List, the national treatment principle shall apply. Besides, certain approval and/or filing requirements shall be fulfilled in accordance with applicable foreign investment laws and regulations.

The business that VIYI conducts through its subsidiaries is not subject to Special Management Measures for the Market Entry of Foreign Investment (Negative List) (2021 Version) (the “2021 Negative List”) issued by MOFCOM and the National Development and Reform Commission, but it is unclear whether any new “negative list” to be issued under the Foreign Investment Law will be different from the 2021 Negative List.

If the chops of VIYI’s PRC subsidiaries and their respective subsidiaries, are not kept safely, are stolen or are used by unauthorized persons or for unauthorized purposes, the corporate governance of these entities could be severely and adversely compromised.

In China, a company chop or seal serves as the legal representation of the company towards third parties even when unaccompanied by a signature. Each legally registered company in China is required to maintain a company chop, which must be registered with the local Public Security Bureau. In addition to this mandatory company chop, companies may have several other chops which can be used for specific purposes. The chops of VIYI’s PRC subsidiaries are generally held securely by personnel designated or approved by VIYI in accordance with its internal control procedures. To the extent those chops are not kept safely, are stolen or are used by unauthorized persons or for unauthorized purposes, the corporate governance of these entities could be severely and adversely compromised and those corporate entities may be bound to abide by the terms of any documents so chopped, even if they were chopped by an individual who lacked the requisite power and authority to do so. In addition, if the chops are misused by unauthorized persons, VIYI could experience disruption to VIYI’s normal business operations. VIYI may have to take corporate or legal action, which could involve significant time and resources to resolve while distracting management from VIYI’s operations.

The PRC government exerts substantial influence over the manner in which VIYI, its subsidiaries must conduct its business activities. VIYI is currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if VIYI was required to obtain approval in the future and was denied permission from Chinese authorities to list on U.S. exchanges, VIYI will not be able to continue listing on U.S. exchange, which would materially affect the interest of the investors.

The PRC government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. VIYI’s ability to operate in China may be harmed by changes in its laws and regulations, including those relating to taxation, environmental regulations, land use rights, property and other matters. The central data security, anti-monopoly policies or local PRC governments may impose

new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on VIYI’s part to ensure its compliance with such regulations or interpretations. Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in the PRC or particular regions thereof, and could require VIYI to divest itself of any interest it then hold in Chinese properties.

For example, the Chinese cybersecurity regulator announced on July 2, 2021 that it had begun an investigation of Didi Global Inc. (NYSE: DIDI) and two days later ordered that the company’s app be removed from smartphone app stores.

Additionally, on July 6, 2021, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the Opinions on Strictly Cracking Down on Illegal Securities Activities, or the Opinions, which emphasized the need to strengthen administration over illegal securities activities and supervision of overseas listings by China-based companies. The Opinions proposed promoting regulatory systems to deal with risks facing China-based overseas-listed companies, and provided that the State Council will revise provisions regarding the overseas issuance and listing of shares by companies limited by shares and will clarify the duties of domestic regulatory authorities. However, the Opinions did not provide detailed rules and regulations. As a result, uncertainties remain regarding the interpretation and implementation of the Opinions.

As such, VIYI’s business segments may be subject to various government and regulatory interference in the provinces in which they operate. VIYI could be subject to regulation by various political and regulatory entities, including various local and municipal agencies and government sub-divisions. VIYI may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply.

Furthermore, it is uncertain when and whether VIYI will be required to obtain permission from the PRC government to list on U.S. exchanges in the future, and even when such permission is obtained, whether it will be denied or rescinded. Although VIYI is currently not required to obtain permission from any of the PRC federal or local government to obtain such permission and has not received any denial to list on the U.S. exchange, VIYI’s operations could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to its business or industry.

Draft rules for China-based companies seeking for securities offerings in foreign stock markets were released by the CSRC for public consultation. While such rules have not yet come into effect, the Chinese government may exert more oversight and control over overseas public offerings conducted by China-based issuers, which could significantly limit or completely hinder VIYI’s ability to offer or continue to offer VIYI’s Ordinary Shares to investors and could cause the value of VIYI’s Ordinary Shares to significantly decline or become worthless.

The Draft Rules Regarding Overseas Listing, among other things, stipulate that, after making initial applications with overseas stock markets for initial public offerings or listings, all China-based companies shall file with the CSRC within three working days. The required filing materials with the CSRC include (without limitation): (i) record-filing reports and related undertakings, (ii) compliance certificates, filing or approval documents from the primary regulator of the applicants’ businesses (if applicable), (iii) security assessment opinions issued by related departments (if applicable), (iv) PRC legal opinions, and (v) proxy statement. In addition, overseas offerings and listings may be prohibited for such China-based companies when any of the following applies: (1) if the intended securities offerings and listings are specifically prohibited by the laws, regulations or provision of the PRC; (2) if the intended securities offerings and listings may constitute a threat to, or endanger national security as reviewed and determined by competent authorities under the State Council in accordance with laws; (3) if there are material ownership disputes over applicants’ equity interests, major assets, core technologies, etc.; (4) if, in the past three years, applicants’ domestic enterprises, controlling shareholders or de facto controllers have committed corruption, bribery, embezzlement, misappropriation of property, or other criminal offenses disruptive to the order of the socialist market economy, or are currently under judicial investigation for suspicion of criminal offenses, or are under investigation for suspicion of major violations; (5) if, in the past three years, any directors, supervisors, or senior executives of applicants have been subject to administrative punishments for severe violations, or are currently under judicial investigation for suspicion of criminal offenses, or are under investigation for suspicion of major

violations; (6) other circumstances as prescribed by the State Council. VIYI does not believe any of the six prohibited situations aforementioned applies to VIYI. The Draft Administrative Provisions further stipulate that a fine between RMB 1 million and RMB 10 million may be imposed if an applicant fails to fulfill the filing requirements with the CSRC or conducts an overseas offering or listing in violation of the Draft Rules Regarding Overseas Listings, and in cases of severe violations, a parallel order to suspend relevant businesses or halt operations for rectification may be issued, and relevant business permits or operational license revoked.

Although VIYI does not believe that VIYI is currently prohibited from overseas offering and listings, if the Draft Rules Regarding Overseas Listings is enacted, VIYI may be subject to additional compliance requirements in the future. Since the Draft Rules Regarding Overseas Listings are newly promulgated, and the interpretation and implementation are not very clear, VIYI cannot assure you that VIYI will be able to receive clearance of such filing requirements in a timely manner, or at all, in the future. If the CSRC requires that VIYI obtain its approval prior to the completion of this offering, the offering will be delayed until VIYI has obtained CSRC approval, which may take several months. There is also the possibility that VIYI may not be able to obtain or maintain such approval or that VIYI inadvertently concluded that such approval was not required. If prior CSRC approval was required while VIYI inadvertently concluded that such approval was not required or if applicable laws and regulations or the interpretation of such were modified to require VIYI to obtain the CSRC approval in the future, VIYI may face regulatory actions or other sanctions from the CSRC or other Chinese regulatory authorities. These authorities may impose fines and penalties upon VIYI’s operations in China, limit VIYI’s operating privileges in China, delay or restrict the repatriation of the proceeds from this offering into China, or take other actions that could have a material adverse effect on VIYI’s business, financial condition, results of operations, reputation and prospects, as well as the trading price of VIYI’s Ordinary Shares. The CSRC or other Chinese regulatory agencies may also take actions requiring VIYI, or making it advisable for VIYI, to terminate this Business Combination prior to closing. Any failure of VIYI to fully comply with new regulatory requirements may significantly limit or completely hinder VIYI’s ability to offer or continue to offer the Ordinary Shares, cause significant disruption to VIYI’s business operations, severely damage VIYI’s reputation, materially and adversely affect VIYI’s financial condition and results of operations, and cause the Ordinary Shares to significantly decline in value or become worthless.

Adverse changes in China’s economic, political or social conditions or government policies could have a material adverse effect on VIYI’s business, financial condition and results of operations.

Substantially all of VIYI’s revenues are generally sourced from China. Accordingly, VIYI’s results of operations, financial condition and prospects are influenced by economic, political and legal developments in China. Economic reforms begun in the late 1970s have resulted in significant economic growth. However, any economic reform policies or measures in China may from time to time be modified or revised. China’s economy differs from the economies of most developed countries in many respects, including with respect to the amount of government involvement, level of development, growth rate, and control of foreign exchange and allocation of resources. Although the Chinese government has implemented measures emphasizing the utilization of market forces for economic reform, the reduction of state ownership of productive assets and the establishment of improved corporate governance in business enterprises, a substantial portion of productive assets in China is still owned by the government. In addition, the Chinese government continues to play a significant role in regulating industry development by imposing industrial policies. The Chinese government also exercises significant control over China’s economic growth through allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policy, and providing preferential treatment to particular industries or companies.

While the PRC economy has experienced significant growth in the past 30 years, growth has been uneven across different regions and among different economic sectors. The Chinese government has implemented measures to encourage economic growth and guide the allocation of the resources. Some of these measures may benefit the overall Chinese economy, but may have a negative effect on VIYI. For example, VIYI’s financial condition and results of operations may be adversely affected by government control over capital investments or changes in tax regulations.

Although the PRC economy has grown significantly in the past decade, that growth may not continue, as evidenced by the slowing of the growth of the PRC economy since 2012. Any adverse changes in economic conditions in China, in the policies of the PRC government or in the laws and regulations in China could have a material adverse effect on the overall economic growth of China. Such developments could adversely affect VIYI’s business and operating results, lead to reduction in demand for VIYI’s services and adversely affect VIYI’s competitive position.

A severe or prolonged downturn in the PRC or global economy and political tensions between the United States and China could materially and adversely affect VIYI’s business and VIYI’s financial condition.

The global macroeconomic environment is facing challenges, including the end of quantitative easing by the U.S. Federal Reserve, the economic slowdown in the Eurozone since 2014 and uncertainties over the impact of Brexit. The Chinese economy has shown slower growth compared to the previous decade since 2012 and the trend may continue. There is considerable uncertainty over the long-term effects of the expansionary monetary and fiscal policies adopted by the central banks and financial authorities of some of the world’s leading economies, including the United States and China. There have been concerns over unrest and terrorist threats in the Middle East, Europe and Africa, which have resulted in market volatility.

If VIYI plans to expand its business internationally and do business cross-border in the future, any unfavorable government policies on international trade, such as capital controls or tariffs, may affect the demand for VIYI’s products and services, impact VIYI’s competitive position, or prevent VIYI from being able to conduct business in certain countries. If any new tariffs, legislation, or regulations are implemented, or if existing trade agreements are renegotiated, such changes could adversely affect VIYI’s business, financial condition, and results of operations. In particular, there have been heightened tensions in international economic relations between the United States and China. The U.S. government has recently imposed, and has recently proposed to impose additional, new, or higher tariffs on certain products imported from China to penalize China for what the U.S. government characterizes as unfair trade practices. China has responded by imposing, and proposing to impose additional, new, or higher tariffs on certain products imported from the United States. Following mutual retaliatory actions for months, on January 15, 2020, the United States and China entered into the Economic and Trade Agreement Between the United States of America and the People’s Republic of China as a phase one trade deal, effective on February 14, 2020. Although the direct impact of the current international trade tension, and any escalation of such tension, on the AR industry in China is uncertain, the negative impact on general, economic, political and social conditions may adversely impact VIYI’s business, financial condition and results of operations.

Furthermore, as part of a continued regulatory focus in the United States on access to audit and other information currently protected by national law, in particular China’s, on December 18, 2020, U.S. President Donald J. Trump signed the Holding Foreign Companies Accountable Act into law, which requires the SEC to propose rules within 90 days after its enactment to prohibit securities of any registrant from being listed on any of the U.S. securities exchanges or traded “over the counter” if the auditor of the registrant’s financial statements is not subject to PCAOB inspection for three consecutive years after the law becomes effective. The Holding Foreign Companies Accountable Act and any proposed SEC rules may have a material and adverse impact on the stock performance of China-based companies listed in the United States. In addition, the recent market panics over the global outbreak of COVID-19 materially and negatively affected the global financial markets in March 2020, which may cause potential slowdown of the global economy. Economic conditions in China are sensitive to global economic conditions, as well as changes in domestic economic and political policies and the expected or perceived overall economic growth rate in China. Any severe or prolonged slowdown in the global or Chinese economy and the political tensions between the United States and China may materially and adversely affect VIYI’s business, financial condition, results of operations and prospects.

The recent joint statement by the SEC and PCAOB, proposed rule changes submitted by Nasdaq, and the Holding Foreign Companies Accountable Act all call for additional and more stringent criteria to be applied to emerging market companies, including companies based in China, upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB.

On April 21, 2020, SEC Chairman Jay Clayton and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement highlighting the risks associated with investing in companies based in or have substantial operations in emerging markets including China. The joint statement emphasized the risks associated with lack of access for the PCAOB to inspect auditors and audit work papers in China and higher risks of fraud in emerging markets.

On May 18, 2020, Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating in “Restrictive Market”, (ii) adopt a new requirement relating to the qualification of management or board of director for Restrictive Market companies, and (iii) apply additional and more stringent criteria to an applicant or listed company based on the qualifications of the company’s auditors.

On May 20, 2020, the U.S. Senate passed the Holding Foreign Companies Accountable Act (“HFCA Act”) requiring a foreign company to certify it is not owned or controlled by a foreign government if the PCAOB is unable to audit specified reports because the company uses a foreign auditor not subject to PCAOB inspection. If the PCAOB is unable to inspect the company’s auditors for three consecutive years, the issuer’s securities are prohibited to trade on a national exchange. On December 2, 2020, the U.S. House of Representatives approved the Holding Foreign Companies Accountable Act. On December 18, 2020, the Holding Foreign Companies Accountable Act was signed into law. On June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act. The bill, if enacted, would shorten the three-consecutive-year compliance period under the HFCA Act to two consecutive years. As a result, the time period before VIYI’s securities may be prohibited from trading or delisted will be reduced. On December 2, 2021, the SEC adopted final amendments implementing congressionally mandated submission and disclosure requirements of the Holding Foreign Companies Accountable Act.

Pursuant to the HFCA Act, the PCAOB issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in (1) mainland China of the PRC because of a position taken by one or more authorities in mainland China and (2) Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB’s report identified the specific registered public accounting firms which are subject to these determinations. On August 26, 2022, the PCAOB signed a Statement of Protocol (“SOP”) with the China Securities Regulatory Commission and the Ministry of Finance of PRC, taking the first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong completely, consistent with U.S law. Pursuant to the SOP, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. However, uncertainties still exist as to whether the applicable parties, including governmental agencies, will fully comply with the framework. Depending on the implementation of the SOP, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered public accounting firms in China, then China-based companies will be delisted pursuant to the HFCA Act despite the SOP. Therefore, there is no assurance that the SOP could give relief to China-based companies against the delisting risk from the application of the HFCA Act or AHFCAA. The lack of access to the PCAOB inspection in China prevents the PCAOB from fully evaluating audits and quality control procedures of the auditors based in China. As a result, the investors may be deprived of the benefits of such PCAOB inspections. The inability of the PCAOB to conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of these accounting firms’ audit procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections.

VIYI’s auditor, the independent registered public accounting firm that issues the audit report included elsewhere in this proxy statement, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess VIYI’s auditor’s compliance with the applicable professional standards. VIYI’s auditor is headquartered in Manhattan, New York, and has been inspected by the PCAOB on a regular basis with the last inspection in June 2018. Therefore, it is not subject to the determinations announced by the PCAOB on December 16, 2021. However, in the event the PRC authorities would further strengthen regulations over auditing work of Chinese companies listed on the U.S. stock exchanges, which would prohibit VIYI’s current auditor to perform work in China, then VIYI would need to change its auditor and the audit work papers prepared by VIYI’s new auditor may not be inspected by the PCAOB without the approval of the PRC authorities, in which case the PCAOB may not be able to fully evaluate the audit or the auditors’ quality control procedures. Furthermore, due to the recent developments in connection with the implementation of the Holding Foreign Companies Accountable Act, VIYI cannot assure you whether the SEC, Nasdaq or other regulatory authorities would apply additional and more stringent criteria to VIYI after considering the effectiveness of VIYI’s auditor’s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach or experience as it relates to the audit of VIYI’s financial statements. The requirement in the HFCA Act that the PCAOB be permitted to inspect the issuer’s public accounting firm within three years, may result in the delisting of VIYI in the future if the PCAOB is unable to inspect VIYI’s accounting firm at such future time.

Uncertainties in the promulgation, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and VIYI.

The PRC legal system is a civil law system based on written statutes. Unlike the common law system, prior court decisions under the civil law system may be cited for reference but have limited precedential value. Since these laws and regulations are relatively new and the PRC legal system continues to rapidly evolve, the promulgation

of new rules and explanations and interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involves uncertainties. For example, the enforcement of laws and rules and regulations in China can change quickly with little advance notice and there are risks that the Chinese government may intervene or influence VIYI’s operations at any time, or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in VIYI’s operations and/or the value of VIYI’s ordinary shares.

In 1979, the PRC government began to promulgate a comprehensive system of laws and regulations governing economic matters in general. The overall effect of legislation over the past three decades has significantly enhanced the protections afforded to various forms of foreign investments in China. However, China has not developed a fully integrated legal system, and recently enacted laws and regulations may not sufficiently cover all aspects of economic activities in China. In particular, the interpretation and enforcement of these laws and regulations involve uncertainties. Specifically, rules and regulations in China can change quickly with little advance notice.

From time to time, VIYI may have to resort to administrative and court proceedings to enforce VIYI’s legal rights. However, since PRC administrative and court authorities have significant discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection VIYI enjoys than in more developed legal systems. Furthermore, the PRC legal system is based in part on government policies and internal rules (some of which are not published in a timely manner or at all) that may have retroactive effect. As a result, VIYI may not be aware of its violation of these policies and rules until sometime after the violation. Such uncertainties, including uncertainty over the scope and effect of VIYI’s contractual, property (including intellectual property) and procedural rights, could materially and adversely affect VIYI’s business and impede VIYI’s ability to continue its operations.

VIYI is subject to extensive and evolving legal system in the PRC, non-compliance with which, or changes in which, may materially and adversely affect VIYI’s business and prospects, and may result in a material change in VIYI’s operations and/or the value of VIYI’s ordinary shares or could significantly limit or completely hinder VIYI’s ability to offer or continue to offer securities to investors and cause the value of VIYI’s securities to significantly decline or be worthless.

PRC companies are subject to various PRC laws, regulations and government policies and the relevant laws, regulations and policies continue to evolve. Recently, the PRC government is enhancing supervision over companies seeking listings overseas and some specific business or activities such as the use of variable interest entities and data security or anti-monopoly. The PRC government may adopt new measures that may affect VIYI’s operations, or may exert more oversight and control over offerings conducted outside of China and foreign investment in China-based companies, and VIYI may be subject to challenges brought by these new laws, regulations and policies. However, since these laws, regulations and policies are relatively new and the PRC legal system continues to rapidly evolve, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involve uncertainties. Furthermore, as VIYI may be subject to additional, yet undetermined, laws and regulations, compliance may require VIYI to obtain additional permits and licenses, complete or update registrations with relevant regulatory authorities, adjust VIYI’s business operations, as well as allocate additional resources to monitor developments in the relevant regulatory environment. However, under the stringent regulatory environment, it may take much more time for the relevant regulatory authorities to approve new applications for permits and licenses, and complete or update registrations and VIYI cannot assure you that VIYI will be able to comply with these laws and regulations promptly or at all. The failure to comply with these laws and regulations may delay, or possibly prevent, VIYI to conduct business, accept foreign investments, or be listed overseas.

The occurrence of any of these events may materially and adversely affect VIYI’s business and prospects and may result in a material change in VIYI’s operations and/or the value of VIYI’s ordinary shares or could significantly limit or completely hinder VIYI’s ability to offer or continue to offer securities to investors.

Under the PRC enterprise income tax law, VIYI may be classified as a “PRC resident enterprise”, which could result in unfavorable tax consequences to VIYI and its shareholders and have a material adverse effect on VIYI’s results of operations and the value of your investment.

Under the PRC enterprise income tax law that became effective on January 1, 2008, an enterprise established outside the PRC with “de facto management bodies” within the PRC is considered a “resident enterprise” for PRC enterprise income tax purposes and is generally subject to a uniform 25% enterprise income tax rate on its worldwide income. On April 22, 2009, the State Administration of Taxation, or the SAT, issued the Notice Regarding

the Determination of Chinese-Controlled Overseas Incorporated Enterprises as PRC Tax Resident Enterprise on the Basis of De Facto Management Bodies, or SAT Circular 82, which provides certain specific criteria for determining whether the “de facto management body” of a PRC-controlled enterprise that is incorporated offshore is located in China. Further to SAT Circular 82, on August 3, 2011, the SAT issued the Administrative Measures of Enterprise Income Tax of Chinese-Controlled Offshore Incorporated Resident Enterprises (Trial), or SAT Bulletin 45, which became effective on September 1, 2011, to provide more guidance on the implementation of SAT Circular 82.

According to SAT Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be considered a PRC tax resident enterprise by virtue of having its “de facto management body” in China and will be subject to PRC enterprise income tax on its worldwide income only if all of the following conditions are met: (a) the senior management and core management departments in charge of its daily operations function have their presence mainly in the PRC; (b) its financial and human resources decisions are subject to determination or approval by persons or bodies in the PRC; (c) its major assets, accounting books, company seals, and minutes and files of its board and shareholders’ meetings are located or kept in the PRC; and (d) not less than half of the enterprise’s directors or senior management with voting rights habitually reside in the PRC. SAT Bulletin 45 further clarifies the resident status determination, post-determination administration as well as competent tax authorities.

Although SAT Circular 82 and SAT Bulletin 45 only apply to offshore incorporated enterprises controlled by PRC enterprises or PRC enterprise group instead of those controlled by PRC individuals or foreigners, the determination criteria set forth therein may reflect SAT’s general position on how the term “de facto management body” could be applied in determining the tax resident status of offshore enterprises, regardless of whether they are controlled by PRC enterprises, individuals or foreigners.

VIYI believes that none of its entities outside of China is a PRC resident enterprise for PRC tax purposes even if the standards for “de facto management body” prescribed in the SAT Circular 82 are applicable to VIYI. However, the tax resident status of an enterprise is subject to determination by the PRC tax authorities and uncertainties remain with respect to the interpretation of the term “de facto management body.” If the PRC tax authorities determine that the company or any of VIYI’s subsidiaries outside of China is a PRC resident enterprise for enterprise income tax purposes, VIYI may be subject to PRC enterprise income on VIYI’s worldwide income at the rate of 25%, which could materially reduce VIYI’s net income. In addition, VIYI will also be subject to PRC enterprise income tax reporting obligations.

Although dividends paid by one PRC tax resident to another PRC tax resident should qualify as “tax-exempt income” under the enterprise income tax law, VIYI cannot assure you that dividends by VIYI’s PRC subsidiaries to VIYI’s Cayman Islands holding company will not be subject to a 10% withholding tax, as the PRC foreign exchange control authorities, which enforce the withholding tax on dividends, and the PRC tax authorities have not yet issued guidance with respect to the processing of outbound remittances to entities that are treated as resident enterprises for PRC enterprise income tax purposes.

Non-PRC resident holders of VIYI’s ordinary shares may also be subject to PRC withholding tax on dividends paid by VIYI and PRC tax on gains realized on the sale or other disposition of ordinary shares, if such income is sourced from within the PRC. The tax would be imposed at the rate of 10% in the case of non-PRC resident enterprise holders and 20% in the case of non-PRC resident individual holders. In the case of dividends, VIYI would be required to withhold the tax at source. Any PRC tax liability may be reduced under applicable tax treaties or similar arrangements. Although VIYI’s holding company is incorporated in the Cayman Islands, it remains unclear whether dividends received and gains realized by VIYI’s non-PRC resident holders of VIYI’s ordinary shares will be regarded as income from sources within the PRC if VIYI is classified as a PRC resident enterprise. Any such tax will reduce the returns on your investment in VIYI’s ordinary shares.

VIYI cannot assure you that the PRC tax authorities will not, at their discretion, adjust any capital gains and impose tax return filing and withholding or tax payment obligations with respect to any internal restructuring, and VIYI’s PRC subsidiaries may be requested to assist in the filing. Any PRC tax imposed on a transfer of VIYI’s shares not through a public stock exchange, or any adjustment of such gains would cause VIYI to incur additional costs and may have a negative impact on the value of your investment in the company.

VIYI may not be able to obtain certain benefits under relevant tax treaties on dividends paid by its PRC subsidiaries to VIYI through its Hong Kong subsidiaries.

VIYI is an exempted company with limited liability, used as holding company, incorporated under the laws of the Cayman Islands and as such rely on dividends and other distributions on equity from VIYI’s PRC subsidiaries, as paid to VIYI through VIYI’s Hong Kong subsidiaries, to satisfy part of VIYI’s liquidity requirements. Pursuant to the PRC Enterprise Income Tax Law, a withholding tax rate of 10% currently applies to dividends paid by a PRC “resident enterprise” to a foreign enterprise investor, unless any such foreign investor’s jurisdiction of incorporation has a tax treaty with China that provides for preferential tax treatment. Pursuant to the Arrangement between the Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the Double Tax Avoidance Arrangement, and Circular 81 issued by the State Administration of Taxation, such withholding tax rate may be lowered to 5% if the PRC enterprise is at least 25% held by a Hong Kong enterprise throughout the 12 months prior to distribution of the dividends and is determined by the relevant PRC tax authority to have satisfied other requirements. Furthermore, under the Administrative Measures for Non-Resident Enterprises to Enjoy Treatments under Tax Treaties, which became effective in August 2015, the non-resident enterprises shall determine whether they are qualified for preferential tax treatment under the tax treaties and file relevant reports and materials with the tax authorities. There are also other conditions for benefiting from the reduced withholding tax rate according to other relevant tax rules and regulations. VIYI cannot assure you that its determination regarding VIYI’s Hong Kong subsidiaries’ qualification to benefit from the preferential tax treatment will not be challenged by the relevant PRC tax authority or that VIYI will be able to complete the necessary filings with the relevant PRC tax authority and benefit from the preferential withholding tax rate of 5% under the Double Taxation Avoidance Arrangement with respect to dividends to be paid by VIYI’s PRC subsidiaries to its Hong Kong subsidiaries.

VIYI faces uncertainty with respect to indirect transfers of equity interests in PRC resident enterprises by their non-PRC holding companies.

VIYI faces uncertainties regarding the reporting on and consequences of previous private equity financing transactions involving the transfer and exchange of shares in VIYI by non-resident investors. In February 2015, the SAT issued the Bulletin on Issues of Enterprise Income Tax on Indirect Transfers of Assets by Non-PRC Resident Enterprises, or SAT Bulletin 7, as amended in 2017. Pursuant to this bulletin, an “indirect transfer” of assets, including equity interests in a PRC resident enterprise, by non-PRC resident enterprises may be re-characterized and treated as a direct transfer of PRC taxable assets, if such arrangement does not have a reasonable commercial purpose and was established for the purpose of avoiding payment of PRC enterprise income tax. As a result, gains derived from such indirect transfer may be subject to PRC enterprise income tax. According to SAT Bulletin 7, “PRC taxable assets” include assets attributed to an establishment in China, immovable properties located in China, and equity investments in PRC resident enterprises, in respect of which gains from their transfer by a direct holder, being a non-PRC resident enterprise, would be subject to PRC enterprise income taxes. When determining whether there is a “reasonable commercial purpose” of the transaction arrangement, features to be taken into consideration include: whether the main value of the equity interest of the relevant offshore enterprise derives from PRC taxable assets; whether the assets of the relevant offshore enterprise mainly consist of direct or indirect investment in China or if its income mainly derives from China; whether the offshore enterprise and its subsidiaries directly or indirectly holding PRC taxable assets have real commercial nature which is evidenced by their actual function and risk exposure; the duration of existence of the business model and organizational structure; the replicability of the transaction by direct transfer of PRC taxable assets; and the tax situation of such indirect transfer and applicable tax treaties or similar arrangements. In respect of an indirect offshore transfer of assets of a PRC establishment, the resulting gain is to be included with the enterprise income tax filing of the PRC establishment or place of business being transferred, and would consequently be subject to PRC enterprise income tax at a rate of 25%. Where the underlying transfer relates to the immovable properties located in China or to equity investments in a PRC resident enterprise, which is not related to a PRC establishment or place of business of a non-resident enterprise, a PRC enterprise income tax of 10% would apply, subject to available preferential tax treatment under applicable tax treaties or similar arrangements, and the party who is obligated to make the transfer payments has the withholding obligation. SAT Bulletin 7 does not apply to transactions of sale of shares by investors through a public stock exchange where such shares were acquired from a transaction through a public stock exchange.

There is uncertainty as to the application of SAT Bulletin 7. VIYI faces uncertainties as to the reporting and other implications of certain past and future transactions where PRC taxable assets are involved, such as offshore restructuring, sale of the shares in VIYI’s offshore subsidiaries or investments. VIYI may be subject to filing obligations or taxed if VIYI is transferor in such transactions, and may be subject to withholding obligations if VIYI is transferee in such transactions under SAT Bulletin 7. For transfer of shares in VIYI by investors that are non-PRC resident enterprises, VIYI’s PRC subsidiaries may be requested to assist in the filing under SAT Bulletin 7. As a result, VIYI may be required to expend valuable resources to comply with SAT Bulletin 7 or to request the relevant transferors from whom VIYI purchase taxable assets to comply with these circulars, or to establish that VIYI should not be taxed under these circulars, which may have a material adverse effect on VIYI’s financial condition and results of operations.

Certain judgments obtained against VIYI by its shareholders may not be enforceable.

VIYI is a Cayman Islands exempted company and substantially all of VIYI’s current operations are conducted in China. In addition, most of VIYI’s current directors and officers are nationals and residents of countries other than the United States. As a result, it may be difficult or impossible for you to bring an action against VIYI or against these individuals in the United States in the event that you believe that your rights have been infringed under the U.S. federal securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of China may render you unable to enforce a judgment against VIYI’s assets or the assets of VIYI’s directors and officers.

Implementation of labor laws and regulations in China may adversely affect VIYI’s business and results of operations.

Pursuant to the labor contract law that took effect in January 2008, its implementation rules that took effect in September 2008 and its amendment that took effect in July 2013, employers are subject to stricter requirements in terms of signing labor contracts, minimum wages, paying remuneration, determining the term of employees’ probation and unilaterally terminating labor contracts. Due to lack of detailed interpretative rules and uniform implementation practices and broad discretion of the local competent authorities, it is uncertain as to how the labor contract law and its implementation rules will affect VIYI’s current employment policies and practices. VIYI’s employment policies and practices may violate the labor contract law or its implementation rules, and VIYI may thus be subject to related penalties, fines or legal fees. Compliance with the labor contract law and its implementation rules may increase VIYI’s operating expenses, in particular VIYI’s personnel expenses. In the event that VIYI decides to terminate some of VIYI’s employees or otherwise change VIYI’s employment or labor practices, the labor contract law and its implementation rules may also limit VIYI’s ability to effect those changes in a desirable or cost-effective manner, which could adversely affect VIYI’s business and results of operations. According to the Social Insurance Law and the Regulations on the Management of Housing Fund, employees must participate in pension insurance, work-related injury insurance, medical insurance, unemployment insurance and maternity insurance and housing funds, and the employers must, together with their employees or separately, pay the social insurance premiums and housing funds for such employees.

As the interpretation and implementation of these laws and regulations are still evolving, VIYI cannot assure you that VIYI’s employment practice will at all times be deemed in full compliance with labor-related laws and regulations in China, which may subject VIYI to labor disputes or government investigations. If VIYI is deemed to have violated relevant labor laws and regulations, VIYI could be required to provide additional compensation to VIYI’s employees and VIYI’s business, financial condition and results of operations could be materially and adversely affected.

Further, labor disputes, work stoppages or slowdowns at VIYI’s operations or any of VIYI’s third-party service providers could significantly disrupt daily operation or VIYI’s expansion plans and have a material adverse effect on VIYI’s business.

The M&A Rules and certain other PRC regulations may make it more difficult for VIYI to pursue growth through acquisitions.

foreign investors, including requirements in some instances that the Ministry of Commerce of the PRC be notified in advance of any change-of-control transaction in which a foreign investor takes control of a PRC domestic enterprise. Moreover, the Anti-Monopoly Law promulgated by the Standing Committee of the National People’s Congress, which became effective in 2008, requires that transactions which are deemed concentrations and involve parties with specified turnover thresholds must be cleared by the Ministry of Commerce before they can be completed. In addition, the security review rules issued by the Ministry of Commerce and became effective in September 2011 specify that mergers and acquisitions by foreign investors that raise “national defense and security” concerns and mergers and acquisitions through which foreign investors may acquire de facto control over domestic enterprises that raise “national security” concerns are subject to strict review by the Ministry of Commerce, and the rules prohibit any activities attempting to bypass a security review, including by structuring the transaction through a proxy or contractual control arrangement.

In the future, VIYI may pursue potential strategic acquisitions that are complementary to VIYI’s business and operations. Complying with the requirements of the above-mentioned regulations and other rules to complete such transactions could be time-consuming, and any required approval processes, including obtaining approval or clearance from the Ministry of Commerce, may delay or inhibit VIYI’s ability to complete such transactions, which could affect VIYI’s ability to expand its business or maintain VIYI’s market share. Furthermore, according to the M&A Rules, if a PRC entity or individual plans to merger or acquire its related PRC entity through an overseas company legitimately incorporated or controlled by such entity or individual, such a merger and acquisition will be subject to examination and approval by the Ministry of Commerce. The application and interpretations of M&A Rules are still uncertain, and there is possibility that the PRC regulators may promulgate new rules or explanations requiring that VIYI obtain approval of the Ministry of Commerce for VIYI’s completed or ongoing mergers and acquisitions. There is no assurance that VIYI can obtain such approval from the Ministry of Commerce for VIYI’s mergers and acquisitions, and if VIYI fails to obtain those approvals, VIYI may be required to suspend VIYI’s acquisition and be subject to penalties. Any uncertainties regarding such approval requirements could have a material adverse effect on VIYI’s business, results of operations and corporate structure.

Furthermore, the M&A Rules, among other things, purport to require that an offshore special purpose vehicle controlled directly or indirectly by PRC domestic companies or individuals and formed for purposes of overseas listing through acquisition of PRC domestic interests obtain the approval of the CSRC prior to the listing and trading of such special purpose vehicle’s securities on an overseas stock exchange. The CSRC has not issued any definitive rules or interpretations concerning whether offerings such as this offering are subject to the CSRC approval procedures under the M&A Rules. In the opinion of VIYI’s PRC counsel, VIYI is not required to obtain approvals from the CSRC under the M&A Rules for listing and trading of the securities, because (i) the CSRC currently has not issued any definitive rules or interpretations concerning whether offerings are subject to the CSRC approval procedures under the M&A Rules, (ii) VIYI established a WFOE utilizing foreign direct investment that is not through a merger or acquisition of the equity or asset of a “PRC domestic company” as defined under the M&A Rules;. However, uncertainties still exist as to how the M&A Rules will be interpreted and implemented and the opinion stated above is subject to any new laws, rules and regulations or detailed implementations and interpretations in any form relating to the M&A Rules.

PRC regulations relating to offshore investment activities by PRC residents may limit VIYI’s PRC subsidiaries’ ability to increase their registered capital or distribute profits to VIYI or otherwise expose VIYI to liability and penalties under PRC law.

The State Administration of Foreign Exchange (“SAFE”) promulgated the Circular on Relevant Issues Relating to PRC Resident’s Investment and Financing and Roundtrip Investment through Special Purpose Vehicles, or SAFE Circular 37, in July 2014 that requires PRC residents or entities to register with SAFE or its local branch in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or financing. In addition, such PRC residents or entities must update their SAFE registrations when the offshore special purpose vehicle undergoes material events relating to any change of basic information (including change of such PRC residents or entities, name and operation term), increases or decreases in investment amount, transfers or exchanges of shares, or mergers or divisions.

SAFE Circular 37 is issued to replace the Circular on Relevant Issues Concerning Foreign Exchange Administration for PRC Residents Engaging in Financing and Roundtrip Investments through Overseas Special Purpose Vehicles. If VIYI’s shareholders who are PRC residents or entities do not complete their registration with the local SAFE branches, VIYI’s PRC subsidiaries may be prohibited from distributing their profits and proceeds

from any reduction in capital, share transfer or liquidation to VIYI, and VIYI may be restricted in its ability to contribute additional capital to VIYI’s PRC subsidiaries. Moreover, failure to comply with SAFE registration described above could result in liability under PRC laws for evasion of applicable foreign exchange restrictions.

However, VIYI may not be informed of the identities of all the PRC residents or entities holding direct or indirect interest of VIYI, nor can VIYI compel its shareholders to comply with the requirements of SAFE Circular 37. As a result, VIYI cannot assure you that all of its shareholders who are PRC residents or entities have complied with, and will in the future make or obtain any applicable registrations or approvals required by, SAFE Circular 37. Failure by such shareholders to comply with SAFE Circular 37, or failure by VIYI to amend the foreign exchange registrations of its PRC subsidiaries, could subject VIYI to fines or legal sanctions, restrict VIYI’s overseas or cross-border investment activities, limit VIYI’s PRC subsidiaries’ ability to make distributions or pay dividends to VIYI or affect VIYI’s ownership structure, which could adversely affect VIYI’s business and prospects.

PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent VIYI from using the proceeds it receives from offshore financing activities to make loans to or make additional capital contributions to VIYI’s PRC subsidiaries, which could materially and adversely affect VIYI’s liquidity and its ability to fund and expand business.

Any transfer of funds by VIYI to its PRC subsidiaries, either as a shareholder loan or as an increase in registered capital, is subject to approval by or registration or filing with relevant governmental authorities in China. According to the relevant PRC regulations on foreign-invested enterprises in China, capital contributions to VIYI’s PRC subsidiaries are subject to the approval of or filing with the Ministry of Commerce in its local branches and registration with a local bank authorized by SAFE. In addition, (i) any foreign loan procured by VIYI’s PRC subsidiaries is required to be registered with SAFE or its local branches or filed with SAFE in its information system; and (ii) VIYI’s PRC subsidiaries may not procure loans which exceed the difference between their total investment amount and registered capital or, as an alternative, only procure loans subject to the calculation approach and limitation as provided in the People’s Bank of China Notice No. 9 (“PBOC Notice No. 9”). Any medium- or long-term loan to be provided by VIYI to the VIE must be registered with the National Development and Reform Commission and SAFE or its local branches. VIYI may not be able to obtain these government approvals or complete such registrations on a timely basis, if at all, with respect to future capital contributions or foreign loans by VIYI to its PRC subsidiaries. If VIYI fails to receive such approvals or complete such registration or filing, VIYI’s ability to use the proceeds it receives from VIYI’s offshore financing activities and to capitalize VIYI’s PRC operations may be negatively affected, which could adversely affect VIYI’s liquidity and ability to fund and expand its business. There is, in effect, no statutory limit on the amount of capital contribution that VIYI can make to its PRC subsidiaries. This is because there is no statutory limit on the amount of registered capital for VIYI’s PRC subsidiaries, and VIYI is allowed to make capital contributions to VIYI’s PRC subsidiaries by subscribing for their initial registered capital and increased registered capital, provided that the PRC subsidiaries complete the relevant filing and registration procedures.

With respect to loans to the VIYI’s PRC subsidiaries by VIYI, (i) if the PRC subsidiaries adopt the traditional foreign exchange administration mechanism, or the Current Foreign Debt Mechanism, the outstanding amount of the loans shall not exceed the difference between the total investment and the registered capital of the PRC subsidiaries; and (ii) if the PRC subsidiaries adopt the foreign exchange administration mechanism as provided in Notice of the People’s Bank of China on Matters concerning the Macro-Prudential Management of Full-Covered Cross-Border Financing, or the PBOC Notice No. 9, the risk-weighted outstanding amount of the loans, which shall be calculated based on the formula provided in PBOC Notice No. 9, shall not exceed 200% of the net asset of the PRC subsidiaries. According to the PBOC Notice No. 9, after a transition period of one year since the promulgation of PBOC Notice No. 9, the PBOC and SAFE will determine the cross-border financing administration mechanism for the foreign-invested enterprises after evaluating the overall implementation of PBOC Notice No. 9. As of the date hereof, neither the PBOC nor SAFE has promulgated and made public any further rules, regulations, notices or circulars in this regard. It is uncertain which mechanism will be adopted by the PBOC and SAFE in the future and what statutory limits will be imposed on VIYI when providing loans to VIYI’s PRC subsidiaries. Currently, VIYI’s PRC subsidiaries have the flexibility to choose between the Current Foreign Debt Mechanism and the Notice No. 9 Foreign Debt Mechanism. However, if a more stringent foreign debt mechanism becomes mandatory, VIYI’s ability to provide loans to VIYI’s PRC subsidiaries or VIYI’s consolidated affiliated entities may be significantly limited, which may adversely affect VIYI’s business, financial condition and results of operations.

The Circular on Reforming the Administration of Foreign Exchange Settlement of Capital of Foreign-Invested Enterprises, or SAFE Circular 19, effective as of June 1, 2015, as amended by Circular of the State Administration of Foreign Exchange on Reforming and Regulating Policies on the Control over Foreign Exchange Settlement under the Capital Account, or SAFE Circular 16, effective on June 9, 2016, allows FIEs to settle their foreign exchange capital at their discretion, but continues to prohibit FIEs from using the Renminbi fund converted from their foreign exchange capitals for expenditure beyond their business scopes, and also prohibit FIEs from using such Renminbi fund to provide loans to persons other than affiliates unless otherwise permitted under its business scope. As a result, VIYI is required to apply Renminbi funds converted from the net proceeds VIYI received from its offshore financing activities within the business scopes of VIYI’s PRC subsidiaries. SAFE Circular 19 and SAFE Circular 16 may significantly limit VIYI’s ability to use Renminbi converted from the net proceeds from VIYI’s offshore financing activities to fund the establishment of new entities in China by their subsidiaries, to invest in or acquire any other PRC companies through VIYI’s PRC subsidiaries, which may adversely affect VIYI’s business, financial condition and results of operations.

VIYI’s PRC subsidiaries are subject to restrictions on paying dividends or making other payments to VIYI, which may restrict its ability to satisfy liquidity requirements, conduct business and pay dividends to holders of VIYI’s ordinary shares.

VIYI is a holding company incorporated in the Cayman Islands. VIYI relies on dividends from its PRC subsidiaries for VIYI’s cash and financing requirements, such as the funds necessary to pay dividends and other cash distributions to VIYI’s shareholders, including holders of VIYI’s ordinary shares, and service any debt VIYI may incur. Current PRC regulations permit VIYI’s PRC subsidiaries to pay dividends to VIYI only out of their accumulated after-tax profits upon satisfaction of relevant statutory condition and procedures, if any, determined under Chinese accounting standards and regulations. In addition, VIYI’s PRC subsidiaries are required to set aside at least 10% of their accumulated profits each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of its registered capital. Furthermore, if VIYI’s PRC subsidiaries incur debt on their behalf in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments to VIYI, which may restrict VIYI’s ability to satisfy VIYI’s liquidity requirements.

In addition, the Enterprise Income Tax Law of the PRC, or the PRC EIT Law, and its implementation rules provide that withholding tax rate of 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC-resident enterprises are incorporated.

Fluctuations in exchange rates could have a material adverse effect on VIYI’s results of operations and the value of your investment.

The value of the Renminbi against the U.S. dollar and other currencies is affected by changes in China’s political and economic conditions and China’s foreign exchange policies, among other things. In 2005, the PRC government changed its decades-old policy of pegging the value of the Renminbi to the U.S. dollar, and the Renminbi appreciated more than 20% against the U.S. dollar over the following three years. Between July 2008 and June 2010, this appreciation halted and the exchange rate between Renminbi and the U.S. dollar remained within a narrow band. Since June 2010, Renminbi has fluctuated against the U.S. dollar, at times significantly and unpredictably. With the development of the foreign exchange market and progress towards interest rate liberalization and Renminbi internationalization, the PRC government may in the future announce further changes to the exchange rate system and VIYI cannot assure you that Renminbi will not appreciate or depreciate significantly in value against the U.S. dollar in the future. It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between Renminbi and the U.S. dollar in the future.

Governmental control of currency conversion may limit VIYI’s ability to utilize revenues effectively and affect the value of your investment.

The PRC government imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. VIYI receives substantially all of VIYI’s revenues in Renminbi. Under VIYI’s current corporate structure, VIYI’s Cayman Islands holding company may rely on dividend payments from VIYI’s PRC subsidiaries to fund any cash and financing requirements VIYI may have. Under

existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of SAFE by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations of VIYI’s PRC subsidiaries in China may be used to pay dividends to VIYI. However, approval from or registration with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, VIYI needs to obtain SAFE approval to use cash generated from the operations of VIYI’s PRC subsidiaries and consolidated affiliated entities to pay off their respective debt in a currency other than Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than Renminbi.

Failure to comply with PRC regulations regarding the registration requirements for employee stock ownership plans or share option plans may subject the PRC plan participants or VIYI to fines and other legal or administrative sanctions.

Pursuant to SAFE Circular 37, PRC residents who participate in share incentive plans in overseas non-publicly-listed companies may submit applications to SAFE or its local branches for the foreign exchange registration with respect to offshore special purpose companies. In the meantime, VIYI’s directors, executive officers and other employees who are PRC citizens or who are non-PRC residents residing in the PRC for a continuous period of not less than one year, subject to limited exceptions, and who have been granted incentive share awards by VIYI, may follow the Notices on Issues Concerning the Foreign Exchange Administration for Domestic Individuals Participating in Stock Incentive Plan of Overseas Publicly-Listed Company, or 2012 SAFE notices, promulgated by the SAFE in 2012. Pursuant to the 2012 SAFE notices, PRC citizens and non-PRC citizens who reside in China for a continuous period of not less than one year who participate in any stock incentive plan of an overseas publicly listed company, subject to a few exceptions, are required to register with SAFE through a domestic qualified agent, which could be the PRC subsidiaries of such overseas listed company, and complete certain other procedures. In addition, an overseas entrusted institution must be retained to handle matters in connection with the exercise or sale of stock options and the purchase or sale of shares and interests. VIYI’s executive officers and other employees who are PRC citizens or who reside in the PRC for a continuous period of not less than one year and who have been granted options are subject to these regulations. Failure to complete the SAFE registrations may subject them to fines, and legal sanctions and may also limit VIYI’s ability to contribute additional capital into VIYI’s PRC subsidiaries and limit VIYI’s PRC subsidiaries’ ability to distribute dividends to VIYI. VIYI also faces regulatory uncertainties that could restrict VIYI’s ability to adopt additional incentive plans for VIYI’s directors, executive officers and employees under PRC law.

The SAT has issued certain circulars concerning employee share options and restricted shares. Under these circulars, VIYI’s employees working in China who exercise share options or are granted restricted shares will be subject to PRC individual income tax. VIYI’s PRC subsidiaries have obligations to file documents related to employee share options or restricted shares with relevant tax authorities and to withhold individual income taxes of those employees who exercise their share options. If VIYI’s employees fail to pay or VIYI fails to withhold their income taxes according to relevant laws and regulations, VIYI may face sanctions imposed by the tax authorities or other PRC governmental authorities.

VIYI’s leased property interests may be defective and its right to lease the properties affected by such defects may be challenged, which could adversely affect VIYI’s business.

According to the PRC Land Administration Law, land in urban districts is owned by the state. The owner of a property built on state-owned land must possess the proper land and property title certificate to demonstrate that

it is the owner of the premises and that it has the right to enter into lease contracts with the tenants or to authorize a third party to sublease the premises. Some of the landlords of VIYI’s leasing center locations have failed to provide the title certificates to VIYI. VIYI’s right to lease the premises may be interrupted or adversely affected if VIYI’s landlords are not the property owners and the actual property owners should appear.

In addition, the title certificate usually records the approved use of the state-owned land by the government and the property owner is obligated to follow the approved use requirement when making use of the property. In the case of failure to utilize the property in accordance with the approved use, the land administration authorities may order the tenant to cease utilizing the premises or even invalidate the contract between the landlord and the tenant. If VIYI’s use of the leased premises is not in full compliance with the approved use of the land, VIYI may be unable to continue to use the property, which may cause disruption to VIYI’s business.

If New Venus is classified as a PRC resident enterprise for PRC enterprise income tax purposes, such classification could result in unfavorable tax consequences to New Venus and its non-PRC shareholders.

Under the PRC Enterprise Income Tax Law and its implementation rules, an enterprise established outside of the PRC with its “de facto management body” within the PRC is considered a “resident enterprise” and will be subject to the enterprise income tax on its global income at the rate of 25%. The implementation rules define the term “de facto management body” as the body that exercises full and substantial control and overall management over the business, productions, personnel, accounts and properties of an enterprise. In 2009, the State Administration of Taxation, or SAT, issued a circular, known as SAT Circular 82, which provides certain specific criteria for determining whether the “de facto management body” of a PRC-controlled enterprise that is incorporated offshore is located in China. Although this circular applies only to offshore enterprises controlled by PRC enterprises or PRC enterprise groups, not those controlled by PRC individuals or foreigners, the criteria set forth in the circular may reflect the SAT’s general position on how the “de facto management body” text should be applied in determining the tax resident status of all offshore enterprises. According to SAT Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be regarded as a PRC tax resident by virtue of having its “de facto management body” in China, and will be subject to PRC enterprise income tax on its global income only if all of the following conditions are met: (i) the primary location of the day-to-day operational management is in the PRC; (ii) decisions relating to the enterprise’s financial and human resource matters are made or are subject to approval by organizations or personnel in the PRC; (iii) the enterprise’s primary assets, accounting books and records, company seals, and board and shareholder resolutions are located or maintained in the PRC; and (iv) at least 50% of voting board members or senior executives habitually reside in the PRC.

Venus believes it is not a PRC resident enterprise for PRC tax purposes. However, the tax resident status of an enterprise is subject to determination by the PRC tax authorities and uncertainties remain with respect to the interpretation of the term “de facto management body.” If the PRC tax authorities determine that Venus is a PRC resident enterprise for enterprise income tax purposes, Venus would be subject to PRC enterprise income tax on New Venus’ worldwide income at the rate of 25%. Furthermore, Venus would be required to withhold a 10% tax from dividends Venus pays to its shareholders that are non-resident enterprises. In addition, non-resident enterprise shareholders may be subject to PRC tax on gains realized on the sale or other disposition of ordinary shares, if such income is treated as sourced from within the PRC. Furthermore, if Venus is deemed a PRC resident enterprise, dividends paid to Venus’ non-PRC individual shareholders and any gain realized on the transfer of the ordinary shares by such shareholders may be subject to PRC tax at a rate of 20% (which, in the case of dividends, may be withheld at source by Venus). These rates may be reduced by an applicable tax treaty, but it is unclear whether non-PRC shareholders of Venus would be able to claim the benefits of any tax treaties between their country of tax residence and the PRC in the event that New Venus is treated as a PRC resident enterprise. Any such tax may reduce the returns on your investment in the ordinary shares.

You must tender your Venus ordinary shares in order to validly seek redemption at the Extraordinary General Meeting.

Venus may require its public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in “street name,” to either tender their certificates (if any) to Venus’ transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up

to two (2) business days prior to the vote on the proposal to approve a business combination in the event Venus distributes proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company’s DWAC (Deposit/Withdrawal At Custodian) System, at the holder’s option, rather than simply voting against a business combination. Any failure to observe these procedures will result in your loss of redemption rights in connection with the vote on the Business Combination.

If third parties bring claims against Venus, the proceeds held in trust could be reduced and the per-share liquidation price received by Venus’ shareholders may be less than $10.10.

Venus’ placing of funds in the trust account may not protect those funds from third-party claims. Although Venus will seek to have all vendors, service providers, prospective target businesses or other entities with which Venus does business execute agreements with Venus waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of Venus’ public shareholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against Venus’ assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, Venus’ management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party’s engagement would be significantly more beneficial to Venus than any alternative.

Examples of possible instances where Venus may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with Venus and will not seek recourse against the trust account for any reason. Upon redemption of Venus’ public shares, if Venus is unable to complete Venus’ business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with Venus’ business combination, Venus will be required to provide for payment of claims of creditors that were not waived that may be brought against Venus within the ten years following redemption. Accordingly, the per-share redemption amount received by public shareholders could be less than the $10.10 per share initially held in the trust account, due to claims of such creditors.

Venus’ Sponsor has agreed that it will be liable to Venus if and to the extent any claims by a vendor for services rendered or products sold to Venus, or a prospective target business with which Venus has discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.10 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under Venus’ indemnity of the underwriters of Venus’ IPO against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, Venus’ Sponsor will not be responsible to the extent of any liability for such third party claims. Venus has not independently verified whether Venus’ Sponsor has sufficient funds to satisfy their indemnity obligations and believes that Venus’ Sponsor’s only assets are securities of Venus. Venus’ Sponsor may not have sufficient funds available to satisfy those obligations. Venus has not asked its Sponsor to reserve for such obligations, and therefore, no funds are currently set aside to cover any such obligations. As a result, if any such claims were successfully made against the trust account, the funds available for the Business Combination and redemptions could be reduced to less than $10.10 per public share. In such event, Venus may not be able to complete the Business Combination, and you would receive such lesser amount per share in connection with any redemption of your public shares. None of Venus’ officers or directors will indemnify Venus for claims by third parties including, without limitation, claims by vendors and prospective target businesses.

Any distributions received by Venus’ shareholders could be viewed as an unlawful payment if it was proved that immediately following the date on which the distribution was made, Venus was unable to pay its debts as they fell due in the ordinary course of business and the value of its assets does not exceed its liabilities.

If Venus is forced to enter into an insolvent liquidation, any distributions received by shareholders could be viewed as an unlawful payment if it was proved that immediately following the date on which the distribution was made, Venus was unable to pay debts as they fall due in the ordinary course of business. As a result, a liquidator could seek to recover all amounts received by Venus’ shareholders. Furthermore, Venus’ directors may be viewed as having breached their fiduciary duties to Venus or its creditors and/or may have acted in bad faith, and thereby exposing themselves and Venus to claims, by paying public shareholders from the trust account prior to addressing the claims of creditors. Venus cannot assure you that claims will not be brought against Venus for these reasons. Venus and its directors and officers who knowingly and willfully authorized or permitted any distribution to be paid out of Venus’ share premium account while Venus was unable to pay debts as they fall due in the ordinary course of business would be guilty of an offence and may be liable on summary conviction to a fine of approximately $18,292.68 and to imprisonment for five years in the Cayman Islands.

If Venus’ due diligence investigation of VIYI was inadequate, then Venus shareholders following the Business Combination could lose some or all of their investment.

Even though Venus conducted a due diligence investigation of VIYI, it cannot be sure that this due diligence uncovered all material issues that may be present inside VIYI or its business, or that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of VIYI and its business and outside of its control will not later arise. If Venus’ due diligence investigation of VIYI was inadequate, then Venus shareholders following the Business Combination could lose some or all of their investment.

Venus’ officers and directors allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to Venus’ affairs. This conflict of interest could have a negative impact on Venus’ ability to complete an alternative business combination.

Venus’ officers and directors are not required to, and will not, commit their full time to Venus’ affairs, which may result in a conflict of interest in allocating their time between Venus’ operations and its search for a business combination and their other businesses. Venus does not have any full-time employees prior to the completion of the Business Combination. Each of Venus’ officers is engaged in several other business endeavours for which he or she may be entitled to substantial compensation and Venus’ officers are not obligated to contribute any specific number of hours per week to Venus’ affairs. Venus’ independent directors also serve as officers and board members for other entities. If Venus’ officers’ and directors’ other business affairs require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to Venus’ affairs which may have a negative impact on Venus’ ability to complete a business combination. These obligations to other parties did not adversely impact its negotiations with VIYI and there is no affiliation between these other business endeavours and VIYI; however, if the proposed Business Combination with VIYI is not consummated, there can be no assurance that Venus and its Sponsor, officers and directors will be successful in sourcing and completing an alternative business combination.

The personal and financial interests of our directors and officers may influence their motivation in timely identifying and selecting a target business and completing a business combination. The different timelines of competing business combinations could cause our directors and officers to prioritize a different business combination over finding a suitable acquisition target for our business combination. Consequently, our directors’ and officers’ discretion in identifying and selecting a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate and in our stockholders’ best interest, which could negatively impact the timing for a business combination.

All of Venus’ officers and directors own Venus ordinary shares, Venus warrants and Venus rights and will not participate in liquidation distributions and, therefore, they may have a conflict of interest in determining whether the Business Combination is appropriate.

In August 2019, Venus’ Sponsor purchased an aggregate of 1,150,000 founder shares of Venus for an aggregate purchase price of $25,000, or approximately $0.02 per share. Prior to the investment in Venus of $25,000

by its Sponsor, Venus had no assets, tangible or intangible. These founder shares will be worthless if Venus does not complete a business combination within a specified time limit. In addition, Venus’ Sponsor has purchased an aggregate of 225,000 private placement units, for a purchase price of $2,250,000 in the aggregate that will also be worthless if Venus does not complete a business combination within a specified time limit.

Each private placement unit consists of one private placement share, one private placement right, granting the holder thereof the right to receive one-tenth (1/10) of an ordinary share upon the consummation of an business combination, and one private placement warrant. Each private placement warrant may be exercised for one-half (1/2) of one ordinary share at a price of $11.50 per whole share, subject to adjustment as provided herein.

The founder shares are identical to Venus’ ordinary shares except that (i) the founder shares are subject to certain transfer restrictions and (ii) Venus’ Sponsor, officers and directors have entered into a letter agreement with Venus, pursuant to which they have agreed (A) to waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of Venus’ business combination, (B) to waive their redemption rights with respect to any founder shares, private placement shares and public shares held by them in connection with a shareholder vote to approve an amendment to Venus’ memorandum and articles of association (x) to modify the substance or timing of Venus’ obligation to provide for the redemption of its public shares in connection with a business combination or to redeem 100% of Venus’ public shares if it has not consummated a business combination within the timeframe set forth therein or (y) with respect to any other provision relating to shareholders’ rights or pre-business combination activity, and (C) to waive their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if Venus fails to complete a business combination within 12 months from the closing of Venus’ IPO (or up to 21 months from the closing of Venus’ IPO if Venus extends the period of time to consummate a business combination, as described in more detail in this proxy statement) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares if they hold that Venus failed to complete a business combination within the prescribed time frame).

The personal and financial interests of Venus’ officers and directors may influence their motivation in identifying and selecting a target business combination, completing a business combination and influencing the operation of the business following the Business Combination.

Venus is requiring shareholders who wish to redeem their Venus ordinary shares in connection with the Business Combination to comply with specific requirements for redemption that may make it more difficult for them to exercise their redemption rights prior to the deadline for exercising their rights.

Venus is requiring public shareholders who wish to redeem their Venus ordinary shares to either tender their certificates to Venus’ transfer agent or deliver their shares to the transfer agent electronically using the Depository Trust Company’s, or DTC, DWAC System prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve a business combination in the event Venus distributes proxy materials. In order to obtain a physical certificate, a shareholder’s broker and/or clearing broker, DTC and Venus’ transfer agent will need to act to facilitate this request. It is Venus’ understanding that shareholders should generally allot at least two weeks to obtain physical certificates from the transfer agent. However, because Venus does not have any control over this process or over the brokers or DTC, it may take significantly longer than two weeks to obtain a physical share certificate. While Venus has been advised that it takes a short time to deliver shares through the DWAC System, Venus cannot assure you of this fact. Accordingly, if it takes longer than Venus anticipates for shareholders to deliver their shares, shareholders who wish to redeem may be unable to meet the deadline for exercising their redemption rights and thus may be unable to redeem their Venus ordinary shares.

Venus will require its public shareholders who wish to redeem their Venus ordinary shares in connection with the Business Combination to comply with specific requirements for redemption described above, such redeeming shareholders may be unable to sell their securities when they wish to in the event that the Business Combination is not consummated.

If Venus requires public shareholders who wish to redeem their Venus ordinary shares in connection with the proposed Business Combination to comply with specific requirements for redemption as described above and the Business Combination is not consummated, Venus will promptly return such certificates to its public shareholders. Accordingly, investors who attempted to redeem their Venus ordinary shares in such a circumstance will be unable to

sell their securities after the failed acquisition until Venus has returned their securities to them. The market price for Venus’ ordinary shares may decline during this time and public shareholders may not be able to sell their securities when they wish to, even while other shareholders that did not seek redemption may be able to sell their securities.

The initial shareholders, including the officers and directors, control a substantial interest in Venus and thus may influence certain actions requiring a shareholder vote.

Venus’ initial shareholders, including the officers and directors, collectively own approximately 22.73% of its issued and outstanding Venus ordinary shares. However, if a significant number of Venus shareholders vote, or indicate an intention to vote, against the Business Combination, Venus’ initial shareholders or the affiliates, could make such purchases in the open market or in private transactions in order to influence the vote. Venus’ initial shareholders or the affiliates have agreed to vote any shares they own in favor of the Business Combination.

If the current Venus’ security holders exercise their registration rights with respect to their securities, it may have an adverse effect on the market price of New Venus’ securities.

Pursuant to an agreement entered into concurrently with the issuance and sale of the securities in Venus’ IPO, Venus’ Sponsor and its permitted transferees can demand that Venus registers their founder shares. In addition, holders of Venus’ private placement units and their permitted transferees can demand that Venus registers the private placement units and their underlying securities, and holders of units that may be issued upon conversion of working capital loans, may demand that Venus registers such units and their underlying securities. Venus will bear the cost of registering these securities. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of Venus’ ordinary shares. In addition, the existence of the registration rights may make Venus’ business combination more costly or difficult to conclude. This is because the shareholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of Venus’ ordinary shares that is expected when the ordinary shares owned by Venus’ Sponsor, holders of Venus’ private placement units or holders of Venus’ working capital loans or their respective permitted transferees are registered.

If the Business Combination’s benefits do not meet the expectations of financial or industry analysts, the market price of Venus’ securities may decline after the consummation of the Business Combination.

The market price of Venus’ securities may decline as a result of the Business Combination if:

Accordingly, investors may experience a loss as a result of decreasing stock prices.

Venus’ directors and officers may have certain conflicts in determining to recommend the acquisition of VIYI, since certain of their interests, and certain interests of their affiliates and associates, are different from, or in addition to, your interests as a shareholder.

Venus’ management and directors have interests in and arising from the Business Combination that are different from, or in addition to, your interests as a shareholder, which could result in a real or perceived conflict of interest. These interests include the following facts:

See also “The Business Combination Proposal — Potential Conflicts of Interest” for further discussion of the possible conflicts between you and our Sponsor, officers and directors as a result of the Business Combination Proposal.

Our Sponsor, officers and directors will not be eligible to be reimbursed for their out-of-pocket expenses if an initial business combination is not completed.

Our Sponsor, officers and directors will not be reimbursed for any expenses incurred by them if we do not complete a business combination. At the closing of our initial business combination, including a business combination with VIYI, our Sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on Venus’s behalf, such as identifying potential target businesses and performing due diligence on suitable business combinations. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred in connection with activities on Venus’ behalf. As of June 10, 2022, these expenses eligible for reimbursement approximate $0. The following table illustrates the out-of-pocket expenses incurred of Sponsor, officers and directors, or any of their respective affiliates, who are awaiting reimbursement on June 10, 2022.

The personal and financial interests of our Sponsor, executive officers and directors on obtaining reimbursement of expenses may therefore influence their motivation in identifying and selecting a target business and completing the Business Combination. See also “The Business Combination Proposal — Potential Conflicts of Interest” for further discussion of the possible conflicts between you and our Sponsor, officer and directors as a result of the Business Combination Proposal.

Venus will incur significant transaction costs in connection with transactions contemplated by the Merger Agreement.

Venus will incur significant transaction costs in connection with the Business Combination. If the Business Combination is not consummated, Venus may not have sufficient funds to seek an alternative business combination and may be forced to voluntarily liquidate and subsequently dissolve.

New Venus’ goodwill is subject to impairment review and any goodwill impairment may negatively affect New Venus’ reported results of operation.

Under United States generally accepted accounting principles (GAAP) requires New Venus to test for goodwill impairment at least annually. In addition, New Venus will review goodwill and amortizable intangible assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. Factors that may be considered a change in circumstances indicating that the carrying value of New Venus’ goodwill or amortizable intangible assets may not be recoverable include declines in stock price, market capitalization or cash

flows, and slower growth rates in New Venus industry. Depending on the results of New Venus’s review, New Venus could be required to record a significant charge to earnings in its financial statements during the period in which any impairment of New Venus’ goodwill or amortizable intangible assets were determined, negatively impacting New Venus’ results of operations.

Venus may not be able to complete an initial business combination with a U.S. target company since such initial business combination may be subject to U.S. foreign investment regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States, or CFIUS, or ultimately prohibited.

Venus’ Chairman Mr. Yanming Liu, a U.S. citizen, is the sole director and holds all the voting securities of Yolanda Management Corporation, or Venus’ Sponsor. Mr. Liu is considered the sole beneficiary owner of Venus’ sponsor under the U.S. securities law. However, five other individuals, including Venus’ CFO, three independent directors and Mr. Zhiguo Zhang are Chinese citizens and have a pecuniary interest in Venus’ ordinary shares through their ownership of shares of Venus’ Sponsor. Yolanda Management Corporation owns approximately 22.73% of the outstanding shares of Venus prior to the business combination. Certain federally licensed businesses in the United States, such as broadcasters and airlines, may be subject to rules or regulations that limit foreign ownership. In addition, CFIUS is an interagency committee authorized to review certain transactions involving foreign investment in the United States by foreign persons in order to determine the effect of such transactions on the national security of the United States. Because Venus may be considered a “foreign person” under such rules and regulations, any proposed business combination between Venus and a U.S. business engaged in a regulated industry or which may affect national security, Venus could be subject to such foreign ownership restrictions and/or CFIUS review. The scope of CFIUS review was expanded by the Foreign Investment Risk Review Modernization Act of 2018 (“FIRRMA”) to include certain non-passive, non-controlling investments in sensitive U.S. businesses and certain acquisitions of real estate even with no underlying U.S. business. FIRRMA, and subsequent implementing regulations that are now in force, also subject certain categories of investments to mandatory filings. If Venus’ initial business combination with VIYI falls within the scope of foreign ownership restrictions, Venus may be unable to consummate a business combination with such business. In addition, if Venus’ business combination falls within CFIUS’s jurisdiction, we may be required to make a mandatory filing or determine to submit a voluntary notice to CFIUS, or to proceed with the initial business combination without notifying CFIUS and risk CFIUS intervention, before or after closing the initial business combination. CFIUS may decide to block or delay Venus’ initial business combination, impose conditions to mitigate national security concerns with respect to such initial business combination or order us to divest all or a portion of a U.S. business of the combined company if Venus had proceeded without first obtaining CFIUS clearance.

Moreover, the process of government review, whether by CFIUS or otherwise, could be lengthy. Because Venus has only a limited time to complete Venus’ initial business combination (12 months, or up to 21 months, if Venus extends the time to complete a business combination as described in this proxy statement) Venus’ failure to obtain any required approvals within the requisite time period may require Venus to liquidate. If Venus liquidates, Venus’ public shareholders may only receive the cash held in the trust account, and Venus’ warrants and rights will expire worthless. This will also cause you to lose any potential investment opportunity in a target company and the chance of realizing future gains on your investment through any price appreciation in the combined company.

There are risks to our stockholders who are not affiliates of the Sponsor of becoming stockholders of the Post-Business Combination company through the Business Combination rather than acquiring securities of VIYI directly in an underwritten public offering, including no independent due diligence review by an underwriter and conflicts of interest of the Sponsor.

Because there is no independent third-party underwriter involved in the Business Combination or the issuance of the ordinary shares as the Merger consideration in connection therewith, investors will not receive the benefit of any outside independent review of VIYI’s finances and operations. Underwritten public offerings of securities conducted by a licensed broker-dealer are subjected to a due diligence review by the underwriter or dealer manager to satisfy statutory duties under the Securities Act, the rules of Financial Industry Regulatory Authority, Inc. (“FINRA”) and the national securities exchange where such securities are listed. Additionally, underwriters or dealer-managers conducting such public offerings are subject to liability for any material misstatements or omissions in a registration statement filed in connection with the public offering. As no such review will be conducted in

connection with the Business Combination, our stockholders must rely on the information in this proxy statement and will not have the benefit of an independent review and investigation of the type normally performed by an independent underwriter in a public securities offering.

In addition, the Sponsor and Venus’ executive officers and directors have interests in the Business Combination that may be different from, or in addition to, the interests of our stockholders generally. Such interests may have influenced Venus’ directors in making their recommendation that you vote in favor of the Business Combination Proposal and the other proposals described in this proxy statement. See “The Business Combination Proposal — Potential Conflicts of Interest” for further discussion of the possible conflicts between you and our Sponsor, officers and directors as a result of the Business Combination Proposal.

Venus’ search for a business combination, and any target business with which Venus ultimately consummates a business combination, may be materially adversely affected by the recent coronavirus (“COVID-19”) outbreak.

In December 2019, a novel strain of coronavirus was reported to have surfaced, which has and is continuing to spread throughout the world. On January 30, 2020, the World Health Organization declared the outbreak of COVID-19 a “Public Health Emergency of International Concern.” On January 31, 2020, U.S. Health and Human Services Secretary Alex M. Azar II declared a public health emergency for the United States to aid the U.S. healthcare community in responding to COVID-19, and on March 11, 2020 the World Health Organization characterized the outbreak as a “pandemic.” The COVID-19 outbreak has resulted in a widespread health crisis that has adversely affected economies and financial markets worldwide, business operations and the conduct of commerce generally, and the business of any potential target business with which Venus consummates a business combination could be, or may already have been, materially and adversely affected. Furthermore, Venus may be unable to complete a business combination if concerns relating to COVID-19 continue to restrict travel or limit the ability to have meetings with potential investors, or the target company’s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts Venus’ search for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, Venus’ ability to consummate a business combination, or the operations of a target business with which Venus ultimately consummates a business combination, may be materially adversely affected.

In addition, Venus’ ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may be impacted by COVID-19 and other events, including as a result of increased market volatility and decreased market liquidity and third-party financing being unavailable on terms acceptable to Venus or at all.

Venus and VIYI have incurred and expect to incur significant costs associated with the Business Combination. Whether or not the Business Combination is completed, the incurrence of these costs will reduce the amount of cash available to be used for other corporate purposes by New Venus if the Business Combination is completed or by Venus if the Business Combination is not completed.

Venus and VIYI expect to incur significant costs associated with the Business Combination. Whether or not the Business Combination is completed, Venus expects to incur approximately $500,000 in expenses. These expenses will reduce the amount of cash available to be used for other corporate purposes by New Venus if the Business Combination is completed or by Venus if the Business Combination is not completed.

Deferred underwriting fees in connection with our IPO and payable at the consummation of our initial business combination will not be adjusted to account for redemptions by our Public Stockholders; if our Public Stockholders exercise their redemption rights, the amount of effective total underwriting commissions as a percentage of the aggregate proceeds from the IPO will increase.

The underwriters in our IPO are entitled to deferred underwriting commissions totalling $1,150,000 upon the consummation of our initial business combination, such amounts being held in our Trust Account until the consummation of our initial business combination. Such amounts will not be adjusted to account for redemptions of Public Shares by our Public Stockholders. Accordingly, the amount of effective total underwriting commissions as a percentage of the aggregate proceeds from the IPO will increase as the number of Public Shares redeemed increases. If

no Public Stockholders of Venus exercise redemption rights with respect to their Public Shares, the amount of effective total underwriting commissions due to the underwriters upon the consummation of our initial business combination will represent ___% of the aggregate proceeds from the IPO retained by Venus taking into account such redemptions. If Public Stockholders of Venus exercise redemption rights with respect to 4,600,000 ordinary shares, the amount of effective total underwriting commissions due to the underwriters upon the consummation of our initial business combination will represent [●]% of the aggregate proceeds from the IPO retained by Venus taking into account such redemptions.

If New Venus fails to implement and maintain an effective system of internal controls, New Venus may be unable to accurately report VIYI’s results of operations, meet New Venus’ reporting obligations or prevent fraud, and investor confidence and the market price of New Venus’. ordinary shares may be materially and adversely affected.

VIYI was a subsidiary to WiMi, a public company, prior to the consummation of the Business Combination. In the course of auditing WiMi’s consolidated financial statements for the years ended December 31, 2020 and 2021, WiMi and its independent registered public accounting firm have identified nine material weaknesses in WiMi’s internal control over financial reporting in accordance with the standards established by the Public Company Accounting Oversight Board of the United States (“PCAOB”). As defined in the standards established by the U.S. Public Company Accounting Oversight Board, a “material weakness” is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. The first material weakness is that WiMi did not maintain an effective control environment. Specifically, WiMi lacked sufficient resources regarding financial reporting and accounting personnel with understanding of U.S. GAAP, in particular, to address complex U.S. GAAP technical accounting issues, related disclosures in accordance with U.S. GAAP and financial reporting requirements set forth by the SEC. In addition, WiMi has identified three material weaknesses in information technology general control (“ITGC”) in the areas of: (1) IT related risk analysis and vulnerability assessment; (2) third party vendor management; (3) system change management (4) system development management; (5); backup management, disaster recovery and off-site back management; (6) system security & assess (SSA) related risk; (7) segregation of duties; (8) process and procedures of audit trail. Although WiMi has since taken some steps to remediate the material weaknesses since its identification, remediation efforts may be ineffective which as a result may materially and adversely VIYI’s business.

After the consummation of the Business Combination VIYI will become a part of Venus (which is referred to as New Venus), a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act of 2002 will require that New Venus include a report of management on its internal control over financial reporting and that its independent registered public accounting firm attest to and report on the effectiveness of New Venus’ internal control over financial reporting in New Venus’ annual report on Form 20-F beginning with New Venus’ annual report for the fiscal year ending December 31, 2022. New Venus’ management may conclude that its internal control over financial reporting is not effective. Moreover, even if New Venus’ management concludes that its internal control over financial reporting is effective, New Venus’ independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with New Venus’ internal controls or the level at which such internal controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from New Venus. In addition, once VIYI becomes part of Venus after the Business Combination, New Venus’ reporting obligations may place a significant strain on management, operational and financial resources and systems for the foreseeable future. New Venus may be unable to timely complete its evaluation testing and any required remediation.

During the course of documenting and testing New Venus’ internal control procedures, in order to satisfy the requirements of Section 404, New Venus may identify other weaknesses and deficiencies in its internal control over financial reporting. In addition, if New Venus fails to maintain the adequacy of its internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, New Venus may not be able to conclude on an ongoing basis that it has effective internal control over financial reporting in accordance with Section 404. If New Venus fails to achieve and maintain an effective internal control environment, it could suffer material misstatements in New Venus’s financial statements and fail to meet reporting obligations, which would likely cause investors to lose confidence in New Venus’s reported financial information. This could in turn limit New Venus’ access to capital markets, harm New Venus’ results of operations, and lead to a decline in the trading price of New Venus’ ordinary shares.

Additionally, ineffective internal control over financial reporting could expose New Venus to increased risk of fraud or misuse of corporate assets and subject New Venus to potential delisting from the stock exchange on which New Venus lists, regulatory investigations and civil or criminal sanctions. New Venus may also be required to restate New Venus’ financial statements from prior periods.

In the event that a significant number of Venus shares are redeemed, New Venus ordinary shares may become less liquid following the Business Combination.

At the time Venus enters into an agreement for the Business Combination, Venus will not know how many shareholders may exercise their redemption rights, and therefore Venus will need to structure the transaction based on its expectations as to the number of shares that will be submitted for redemption. If Venus’ business combination agreement requires Venus to use a portion of the cash in the trust account to pay the purchase price, or requires Venus to have a minimum amount of cash at closing, Venus will need to reserve a portion of the cash in the trust account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption than Venus initially expected, Venus may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. The above considerations may limit Venus’ ability to complete the most desirable business combination available to Venus or optimize its capital structure.

If a shareholder fails to comply with the procedures for redeeming its public shares, such shares may not be redeemed.

In order to validly redeem public shares, holders of Venus’ public shares will need to comply with the various procedures described in this proxy statement. In the event that a shareholder fails to comply with these procedures, its shares may not be redeemed.

The Sponsor or Venus’ directors, executive officers or advisors or their respective affiliates or shareholders of VIYI may elect to purchase shares from Public Stockholders, which may influence the vote on the Business Combination and reduce the public “float” of New Venus’ Ordinary Shares.

The Sponsor or Venus’ directors, executive officers or advisors or their respective affiliates or the shareholders of VIYI may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of the Business Combination, although they are under no obligation to do so and have not advised Venus that they anticipate making such purchases. Such a purchase may include a contractual acknowledgement that such stockholder, although still the record holder of Venus ordinary shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that the Sponsor or Venus’ directors, executive officers or advisors or their respective affiliates purchase shares in privately negotiated transactions from Public Stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. The purpose of such purchases could be to vote such shares in favor of the Business Combination and thereby increase the likelihood of obtaining stockholder approval of the Business Combination, where it appears that such requirement would otherwise not be met. This may result in the completion of the Business Combination that may not otherwise have been possible.

In addition, if such purchases are made, the public “float” of New Venus ordinary shares post-closing and the number of beneficial holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of securities on a national securities exchange.

You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss.

Venus’ public shareholders will be entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion of an initial business combination, and then only in connection with those public shares that such shareholder properly elected to redeem, subject to the limitations described herein, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend Venus’ existing organizational documents pursuant to the extension proxy statement, and (iii) the redemption of Venus’ public shares if it is unable to complete

an initial business combination by February 11, 2022 (unless extended for up to an additional nine (9) months), subject to applicable law and as further described herein. In no other circumstances will a public shareholder have any right or interest of any kind in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants. Accordingly, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss.

Venus may waive one or more of the conditions to the Business Combination without resoliciting Venus shareholder approval for the Business Combination.

Venus may agree to waive, in whole or in part, some of the conditions to its obligations to complete the Business Combination, to the extent permitted by applicable laws. The Venus’ board of directors will evaluate the materiality of any waiver to determine whether amendment of this proxy statement and resolicitation of proxies is warranted.

In some instances, if the Venus’ board of directors determines that a waiver is not sufficiently material to warrant resolicitation of Venus’ shareholders, Venus has the discretion to complete the Business Combination without seeking further shareholder approval. For example, it is a condition to Venus’ obligations to close the Business Combination that there be no restraining order, injunction or other order restricting VIYI’s conduct of its business, however, if the Venus’ board of directors determines that any such order or injunction is not material to the business of VIYI, then the Venus’ board of directors may elect to waive that condition and close the Business Combination.

Venus’ directors may decide not to enforce the indemnification obligations of its Sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to Venus’ public shareholders.

In the event that the proceeds in the trust account are reduced below (i) $10.10 per public share or (ii) such lesser amount per share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, and Venus’ Sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, Venus’ independent directors would determine whether to take legal action against Venus’ Sponsor to enforce its indemnification obligations. While Venus currently expects that its independent directors would take legal action on Venus’ behalf against its Sponsor to enforce its indemnification obligations to Venus, it is possible that such independent directors in exercising their business judgment may choose not to do so in any particular instance. If Venus’ independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to Venus’ public shareholders may be reduced below $10.10 per share.

Venus may not have sufficient funds to satisfy indemnification claims of its directors and executive officers.

Venus has agreed to indemnify its officers and directors to the fullest extent permitted by law. However, Venus’ officers and directors have agreed to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by Venus only if (i) it has sufficient funds outside of the trust account or (ii) Venus consummates an initial business combination. Venus’ obligation to indemnify its officers and directors may discourage shareholders from bringing a lawsuit against its officers or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against Venus’ officers and directors, even though such an action, if successful, might otherwise benefit Venus and its shareholders. Furthermore, a shareholder’s investment may be adversely affected to the extent Venus pays the costs of settlement and damage awards against its officers and directors pursuant to these indemnification provisions.

There will be a substantial number of Venus ordinary shares available for sale in the future that may adversely affect the market price of Venus ordinary shares.

Venus may issue such number of shares as may be approved by its shareholders and authorized by its directors, in accordance with the terms of its memorandum and articles of association. No less than 2.00% shares to be issued in the Business Combination to the current VIYI shareholders (792,079 ordinary shares otherwise issuable to WiMi) will be subject to certain restrictions on sale and cannot be sold for (i) in the case of (A) 50% of the founder shares,

until the earlier of (x) six months after the date of the consummation of our Business Combination or (z) the date on which the closing price of our ordinary shares equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after our Business Combination and (B) the remaining 50% of the founder shares may not be transferred, assigned or sold until six months after the date of the consummation of our Business Combination, or earlier, in either case, if, subsequent to our Business Combination, Venus consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property, and (ii) in the case of the private placement units and the underlying securities, until 30 days after the completion of our Business Combination, except in each case (a) to our Sponsor’s officers or directors, any affiliates or family members of our Sponsor or any of our officers or directors, any members of our Sponsor, or any affiliates of our Sponsor, (b) in the case of an individual, by gift to a member of the individual’s immediate family or to a trust, the beneficiary of which is a member of the individual’s immediate family or an affiliate of such person, or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) in the event of our liquidation prior to our completion of our Business Combination; or (f) by virtue of the laws of the Cayman Islands or our Sponsor’s constitutional documents upon dissolution of our Sponsor; provided, however, that in the case of clauses (a) through (e) or (f) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and by the same agreements entered into by our Sponsor with respect to such securities (including provisions relating to voting, the trust account and liquidation distributions described elsewhere in this proxy statement). In addition, the 1,375,000 New Venus ordinary shares owned by Venus’ initial shareholders that are currently held in escrow will be released and available for sale as early as 6 months from the date of the Business Combination provided that 50.00% of such shares will be released on the date on which the closing price of the shares equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after the Business Combination. After the expiration of this restricted period, there will then be an additional [●] shares that are eligible for trading in the public market. The availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of New Venus ordinary shares.

Venus shareholders will experience immediate dilution as a consequence of the issuance of Venus ordinary shares as consideration in the Business Combination and the automatic conversion of Venus Rights into New Venus ordinary shares upon the consummation of the Business Combination. Having a minority share position may reduce the influence that Venus’ current shareholders have on the management of Venus.

After the Business Combination, (i) assuming there are no redemptions of Venus’ shares, (ii) an exercise of any outstanding Venus Warrants to acquire Venus ordinary shares, and (iii) Venus Rights are converted into New Venus ordinary shares upon the closing of the Business Combination, Venus’ current public shareholders will own approximately 10.97% of the issued share capital of Venus, Venus’ current directors, officers and affiliates will own approximately 3.03% of the issued share capital of Venus, and VIYI shareholders will own approximately 85.84% of the issued share capital of New Venus. Assuming redemption by holders of 2,300,000 Venus’ outstanding ordinary shares, Venus’ current public shareholders will own approximately 6.30% of the issued share capital of Venus, Venus’ current directors, officers and affiliates will own approximately 3.19% of the issued share capital of Venus, and VIYI shareholders will own approximately 90.34% of the issued share capital of Venus. The minority position of the former Venus’ shareholders will give them limited influence over the management and operations of the post-Business Combination Company.

Certain judgments obtained against New Venus by New Venus’ shareholders may not be enforceable.

New Venus is a company incorporated under the laws of the Cayman Islands. VIYI conducts most of its operations in China and substantially all of its operations outside of the United States. Most of VIYI’s assets are located in China, and substantially all of VIYI’s assets are located outside of the United States. In addition, after the Business Combination, most of New Venus’ senior executive officers reside within China for a significant portion of the time and most are PRC nationals. Substantially all of the assets of these persons are located outside the United States. As a result, it may be difficult or impossible for you to bring an action against New Venus or against these individuals in the

United States in the event that you believe that your rights have been infringed under the U.S. federal securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of China may render you unable to enforce a judgment against New Venus’ assets or the assets of VIYI’s directors and officers.

VIYI’s Key Projected Financial Metrics are subject to significant risks, assumptions, estimates and uncertainties, including assumptions regarding future market and changes in regulations. As a result, New Venus’ projected revenues, market share, expenses and profitability may differ materially from its expectations.

The Key Projected Financial Metrics (as defined in the section entitled “The Business Combination Proposal — Certain VIYI Projected Financial Information”) are subject to significant risks, assumptions, estimates and uncertainties, including assumptions regarding future market and changes in regulations. As a result, New Venus’ projected revenues, market share, expenses and profitability may differ materially from its expectations.

VIYI operates in a rapidly evolving and highly competitive industry and its Key Projected Financial Metrics are subject to the risks and assumptions made by management with respect to this industry. Operating results are difficult to forecast because they generally depend on VIYI’s assessment of factors that are inherently beyond its control and impossible to predict with certainty, such as the development and commercialization of new business.

Additionally, VIYI’s business is dependent on, among other things, attracting new customers, developing and marketing new products, brand protection and employee retention, many of which may be difficult to predict. This may result in decreased projected revenue levels, and VIYI may be unable to adopt timely measures to compensate for any shortcomings in revenue and/or operating profitability. This inability could cause VIYI’s operating results in a given period to be higher or lower than budgeted.

Venus shareholders cannot be sure that an active trading market will develop for or of the market price of the ordinary shares of New Venus they will receive or that New Venus will successfully obtain authorization for listing on the Nasdaq Capital Market.

Venus and VIYI have agreed to use their best efforts to cause the ordinary shares of New Venus to be issued in the Business Combination to be approved for listing on the Nasdaq Capital Market prior to the effective time of the Business Combination. However, the listing of shares on the Nasdaq Capital Market does not ensure that a market for the ordinary shares of New Venus will develop or the price at which the shares will trade. No assurance can be provided as to the demand for or trading price of the ordinary shares of New Venus following the closing of the Business Combination and the ordinary shares of New Venus may trade at a price less than the current market price of the ordinary share of Venus.

Even if New Venus is successful in developing a public market, there may not be enough liquidity in such market to enable shareholders to sell their ordinary shares. If a public market for the combined New Venus’ ordinary shares does not develop, investors may not be able to re-sell their ordinary shares, rendering their shares illiquid and possibly resulting in a complete loss of their investment. New Venus cannot predict the extent to which investor interest in New Venus will lead to the development of an active, liquid trading market. The trading price of and demand for the ordinary shares of New Venus following completion of the Business Combination and the development and continued existence of a market and favorable price for the ordinary shares of New Venus will depend on a number of conditions, including the development of a market following, including by analysts and other investment professionals, the businesses, operations, results and prospects of New Venus, general market and economic conditions, governmental actions, regulatory considerations, legal proceedings and developments or other factors. These and other factors may impair the development of a liquid market and the ability of investors to sell shares at an attractive price. These factors also could cause the market price and demand for the ordinary shares of New Venus to fluctuate substantially, which may limit or prevent investors from readily selling their shares and may otherwise affect negatively the price and liquidity of the ordinary shares of New Venus. Many of these factors and conditions are beyond the control of New Venus or New Venus shareholders.

New Venus may be unable to obtain additional financing to fund its operations or growth.

New Venus may require additional financing to fund its operations or growth. The failure to secure additional financing could have a material adverse effect on the continued development or growth of New Venus. None of Venus’ officers, directors or shareholders is required to provide any financing to New Venus in connection with or after its initial business combination.

The market price of New Venus’ ordinary shares may be volatile, both because of actual and perceived changes in the company’s financial results and prospects, and because of general volatility in the stock market. The factors that could cause fluctuations in New Venus’ share price may include, among other factors discussed in this section, the following:

In addition, the stock markets have experienced significant price and trading volume fluctuations from time to time, and the market prices of the equity securities of retailers have been extremely volatile and are sometimes subject to sharp price and trading volume changes. These broad market fluctuations may materially and adversely affect the market price of New Venus’ ordinary shares.

New Venus does not intend to pay cash dividends for the foreseeable future.

Following the Business Combination, New Venus currently intends to retain future earnings, if any, to finance the further development and expansion of its business and does not intend to pay cash dividends in the foreseeable future. Any future determinations to pay dividends will be at the discretion of New Venus’ board of directors and will depend on New Venus’ financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as New Venus’ board of directors deems relevant.

New Venus may be subject to securities litigation, which is expensive and could divert management attention.

The market price of New Venus’ ordinary shares may be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. Additionally, in the recent past, the plaintiff’s bar has been aggressively commencing litigations against SPAC post business combination businesses alleging fraud and other claims based on inaccurate or misleading disclosures in merger related proxies. New Venus may be the target of this type of litigation in the future. Securities litigation against New Venus could result in substantial costs and divert management’s attention from other business concerns, which could seriously harm New Venus’ business.

The sale or availability for sale of substantial amounts ordinary shares could adversely affect New Venus’ market price.

Sales of substantial amounts of the ordinary shares in the public market after the completion of the Business Combination, or the perception that these sales could occur, could adversely affect the market price of the New Venus ordinary shares and could materially impair New Venus’ ability to raise capital through equity offerings in the future. In connection with the Business Combination, VIYI shareholders will exchange the ordinary shares of VIYI held by them for New Venus ordinary shares upon the consummation of the Business Combination and will agree, subject to certain exceptions, not to sell any New Venus ordinary shares for a period as set forth in the Lock-up Agreements. Shares of New Venus to be held by VIYI’s certain existing shareholders after the Business Combination may be sold in the public market in the future subject to the restrictions in Rule 144 and Rule 701 under the Securities Act and the applicable lockup agreements. There will be [●] outstanding and issued New Venus ordinary shares immediately after the Business Combination. New Venus cannot predict what effect, if any, market sales of securities held by New Venus’ significant shareholders or any other holders or the availability of these securities for future sale will have on the market price of the New Venus ordinary shares.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about New Venus or its business, its ordinary shares price and trading volume could decline.

The trading market for New Venus’ ordinary shares will depend in part on the research and reports that securities or industry analysts publish about New Venus or its business. Securities and industry analysts do not currently, and may never, publish research on New Venus. If no securities or industry analysts commence coverage of New Venus, the trading price for its ordinary shares would likely be negatively impacted. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover New Venus downgrade its securities or publish inaccurate or unfavorable research about its business, its stock price would likely decline. If one or more of these analysts cease coverage of New Venus or fail to publish reports on New Venus, demand for its ordinary shares could decrease, which might cause its ordinary share price and trading volume to decline.

New Venus may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.

New Venus will have the ability to redeem outstanding public warrants at any time after they become exercisable and prior to their expiration. If and when the warrants become redeemable by New Venus, New Venus may exercise the redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of the outstanding warrants could force holders to (i) exercise the warrants and pay the exercise price therefor at a time when it may be disadvantageous to do so, (ii) sell the warrants at the then-current market price when the holder might otherwise wish to hold onto such warrants or (iii) accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of the warrants. None of the private placement warrants will be redeemable by us so long as they are held by their initial purchasers or their permitted transferees.

In addition, New Venus may redeem your warrants after they become exercisable for a number of shares of New Venus ordinary shares determined based on the redemption date and the fair market value of New Venus ordinary shares. Any such redemption may have similar consequences to a cash redemption described above. In addition, such redemption may occur at a time when the warrants are “out-of-the- money,” in which case you would lose any potential embedded value from a subsequent increase in the value of our ordinary shares had your warrants remained outstanding.

If the benefits of the Business Combination do not meet the expectations of investors or securities analysts, the market price of our securities may decline.

If the benefits of the Business Combination do not meet the expectations of investors or securities analysts, the market price of Venus’ securities prior to the Closing may decline. The market values of Venus’ securities at the time of the Business Combination may vary significantly from their prices on the date the Merger Agreement was executed, the date of this proxy statement, or the date on which Venus shareholders vote on the Business Combination. Because the number of shares to be issued is based on the per share value of the amount in the Trust Account and will not be adjusted to reflect any changes in the market price of Venus ordinary shares, the market value of New Venus ordinary shares issued in the Business Combination may be higher or lower than the values of these shares on earlier dates.

In addition, following the Business Combination, fluctuations in the price of New Venus’ securities could contribute to the loss of all or part of your investment. Prior to the Business Combination, there has not been a public market for the stock of VIYI and trading in Venus’ ordinary shares has not been active. Accordingly, the valuation ascribed to New Venus in the Business Combination may not be indicative of the price that will prevail in the trading market following the Business Combination. If an active market for our securities develops and continues, the trading price of New Venus securities following the Business Combination could be volatile and subject to wide fluctuations in response to various factors, some of which are beyond our control. Any of the factors listed below could have a material adverse effect on your investment in our securities and New Venus securities may trade at prices significantly below the price you paid for them. In such circumstances, the trading price of our securities may not recover and may experience a further decline.

Broad market and industry factors may materially harm the market price of our securities irrespective of our operating performance. The stock market in general, and Nasdaq specifically, have experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, you may not be able to sell your securities at or above the price at which it was acquired. A loss of investor confidence in the market for the stocks of other companies which investors perceive to be similar to New Venus could depress our stock price regardless of our business, prospects, financial conditions or results of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.

If New Venus cannot satisfy, or continue to satisfy, the initial listing requirements and other rules of Nasdaq, New Venus’ securities may not be listed or may be delisted, which could negatively impact the price of its securities and your ability to sell them.

New Venus will seek to have its securities approved for listing on the Nasdaq Capital Market in connection with the Business Combination. In light of the recent trend of significant redemptions associated with de-SPAC transactions, New Venus cannot assure you that it will be able to meet the initial listing requirement including shareholders’ equity, minimum share price, minimum market value of publicly held shares, 300 round lot shareholders and various additional requirements in order to obtain approval to list on the Nasdaq Capital Market. Even if New Venus’ securities are listed on Nasdaq, it cannot assure you that its securities will continue to be listed on Nasdaq.

In addition, following the Business Combination, in order to maintain its listing on Nasdaq, New Venus will be required to comply with certain rules of Nasdaq, including those regarding minimum shareholders’ equity, minimum share price, minimum market value of publicly held shares, 300 round lot shareholders and various additional requirements. Even if New Venus initially meets the listing requirements and other applicable rules of Nasdaq, New Venus may not be able to continue to satisfy these requirements and applicable rules. If New Venus is unable to satisfy Nasdaq criteria for maintaining its listing, its securities could be subject to delisting.

If Nasdaq does not list New Venus’ securities, or subsequently delists its securities from trading, New Venus could face significant consequences, including:

You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because New Venus is incorporated under Cayman Islands law.

New Venus is an exempted company incorporated under the laws of the Cayman Islands. New Venus’ corporate affairs are governed by its memorandum and articles of association, the Companies Act (As Revised) of the Cayman Islands and the common law of the Cayman Islands. The rights of shareholders to take action against New Venus’ directors, actions by New Venus’ minority shareholders and the fiduciary duties of New Venus’ directors to New Venus under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England, the decisions of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of New Venus’ shareholders and the fiduciary duties of New Venus’ directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands have a less developed body of securities laws than the United States. Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have standings to initiate a shareholder derivative action in a federal court of the United States.

Shareholders of Cayman Islands exempted companies like New Venus have no general rights under Cayman Islands law to inspect corporate records (save for New Venus’ memorandum and articles of association, register of mortgages and charges and any special resolutions of New Venus’ shareholders) or to obtain copies of lists of shareholders of these companies. New Venus’ directors have discretion under its articles of association that will become effective immediately prior to completion of the Business Combination to determine whether or not, and under what conditions, its corporate records may be inspected by its shareholders, but are not obliged to make them available to its shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

As a result of all of the above, New Venus’ public shareholders may have more difficulty in protecting their interests in the face of actions taken by New Venus’ management, users of the board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States.

You may experience difficulties in effecting service of legal process, enforcing foreign judgments or bringing actions in China against New Venus or its management named in the proxy statement based on foreign laws.

New Venus is a company incorporated under the laws of the Cayman Islands, New Venus conducts substantially all of its operations in China, and substantially all of New Venus’ assets are located in China. In addition, all New Venus’ senior executive officers reside within China for a significant portion of the time and most are PRC nationals. As a result, it may be difficult for New Venus’ shareholders to effect service of process upon New Venus or those persons inside China. In addition, China does not have treaties providing for the reciprocal recognition and enforcement of judgments of courts with the Cayman Islands and many other countries and regions. Therefore, recognition and enforcement in China of judgments of a court in any of these non-PRC jurisdictions in relation to any matter not subject to a binding arbitration provision may be difficult or impossible.

Shareholder claims that are common in the United States, including securities law class actions and fraud claims, generally are difficult to pursue as a matter of law or practicality in China. For example, in China, there are significant legal and other obstacles to obtaining information needed for shareholder investigations or litigation outside China or otherwise with respect to foreign entities. Although the local authorities in China may establish a regulatory cooperation mechanism with the securities regulatory authorities of another country or region to implement cross-border supervision and administration, such regulatory cooperation with the securities regulatory authorities in the Unities States have not been efficient in the absence of mutual and practical cooperation mechanism.

According to Article 177 of the PRC Securities Law, which became effective in March 2020, no overseas securities regulator is allowed to directly conduct investigation or evidence collection activities within the territory of the PRC. Accordingly, without the consent of the competent PRC securities regulators and relevant authorities, no organization or individual may provide the documents and materials relating to securities business activities to overseas parties. See also “— Risks Relating to Risks Relating to New Venus — You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because New Venus is incorporated under Cayman Islands law.”

Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect New Venus’ business, investments and results of operations.

New Venus is subject to laws, regulations and rules enacted by national, regional and local governments and the Nasdaq. In particular, New Venus is required to comply with certain SEC, Nasdaq and other legal or regulatory requirements. Compliance with, and monitoring of, applicable laws, regulations and rules may be difficult, time consuming and costly. Those laws, regulations and rules and their interpretation and application may also change from time to time and those changes could have a material adverse effect on New Venus’ business, investments and results of operations. In addition, a failure to comply with applicable laws, regulations and rules, as interpreted and applied, could have a material adverse effect on New Venus’ business and results of operations.

Government agencies in jurisdictions where New Venus and its affiliates will do business have had an extended focus on issues related to the taxation of multinational corporations. One example is in the area of “base erosion and profit shifting,” including situations where payments are made between affiliates from a jurisdiction with high tax rates to a jurisdiction with lower tax rates. As a result, the tax laws in the countries in which New Venus and its affiliates do business could change on a prospective or retroactive basis, and any such changes could adversely affect New Venus and its affiliates.

New Venus is an emerging growth company within the meaning of the Securities Act, and if New Venus takes advantage of certain exemptions from disclosure requirements available to emerging growth companies, this could make New Venus’ securities less attractive to investors and may make it more difficult to compare New Venus’ performance with other public companies.

New Venus is an emerging growth company within the meaning of the Securities Act, as modified by the JOBS Act, and New Venus may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in New Venus periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. As a result, New Venus’ shareholders may not have access to certain information they may deem important. New Venus could remain an emerging growth company for up to five years from the date of New Venus’ IPO, although circumstances could cause New Venus to lose that status earlier, including if the market value of New Venus ordinary shares held by non-affiliates exceeds $700,000,000 as of any June 30 before that time, in which case New Venus would no longer be an emerging growth company as of the following December 31. New Venus cannot predict whether investors will find its securities less attractive because New Venus will rely on these exemptions. If some investors find New Venus’ securities less attractive as a result of its reliance on these exemptions, the trading prices of New Venus’ securities may be lower than they otherwise would be, there may be a less active trading market for New Venus’ securities and the trading prices of its securities may be more volatile.

Further, Section 102(b) (1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. New Venus has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, New Venus, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of New Venus’ financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accountant standards used.

New Venus may be or become a PFIC, which could result in adverse U.S. federal income tax consequences to U.S. Holders.

If New Venus is deemed a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. holder (as defined in the section of this proxy statement captioned “Income Tax Considerations — Certain U.S. Federal Income Tax Considerations — U.S. Holders”) of New Venus’ ordinary shares, rights or warrants, the U.S. holder may be subject to adverse U.S. federal income tax consequences and may be subject to additional reporting requirements. New Venus’ PFIC status for its current and subsequent taxable years may depend on whether New Venus qualifies for the PFIC start-up exception (see the section of this proxy statement captioned “Income Tax Considerations — Certain U.S. Federal Income Tax Considerations — U.S. Holders — Passive Foreign Investment Company Rules”). Depending on the particular circumstances the application of the start-up exception may be subject to uncertainty, and there cannot be any assurance that New Venus will qualify for the start-up exception. Accordingly, there can be no assurances with respect to New Venus’ status as a PFIC for its current taxable year or any subsequent taxable year. New Venus’ actual PFIC status for any taxable year, however, will not be determinable until after the end of such taxable year. Moreover, if New Venus determines that it is a PFIC for any taxable year, New Venus will endeavor to provide to a U.S. holder such information as the Internal Revenue Service (“IRS”) may require, including a PFIC annual information statement, in order to enable the U.S. holder to make and maintain a “qualified electing fund” election, but there can be no assurance that New Venus will timely provide such required information, and such election would be unavailable with respect to New Venus’ warrants in all cases. U.S. holders are urged to consult their own tax advisors regarding the possible application of the PFIC rules to holders of New Venus’ ordinary shares, rights and warrants. For a more detailed explanation of the tax consequences of PFIC classification to U.S. holders, see the section of this proxy statement captioned “Income Tax Considerations — Certain U.S. Federal Income Tax Considerations — U.S. Holders — Passive Foreign Investment Company Rules.”

The following table sets forth the capitalization on a historical basis of Venus and VIYI as of June 30, 2022 after giving effect to the Business Combination assuming that (i) no holders of Venus ordinary shares exercise their redemption rights, and (ii) that the maximum number of holders of Venus ordinary shares have properly exercised their redemption rights.

The discussion in this proxy statement of the Business Combination and the principal terms of the Merger Agreement, is subject to, and is qualified in its entirety by reference to, the Merger Agreement. The full text of the Merger Agreement, without certain disclosure schedules and exhibits and the Plan of Merger is attached hereto as Annex A, which is incorporated by reference herein.

The Merger Agreement contains representations, warranties and covenants that the respective parties made to each other as of the date of the Merger Agreement or other specific dates. The assertions embodied in those representations, warranties and covenants were made and will be made for purposes of the contract among the respective parties and are subject to important qualifications and limitations agreed to by the parties in connection with negotiating the Merger Agreement. The representations, warranties and covenants in the merger agreement are also modified in important part by the underlying disclosure schedules, which are referred to as the “Schedules,” which are not filed publicly and which may be subject to contractual standards of materiality applicable to the contracting parties that differ from what may be viewed as material to shareholders. The representations and warranties in the Merger Agreement and the items listed in the Schedules were used for the purpose of allocating risk among the parties rather than establishing matters as facts.

The Merger Agreement was entered into by and among Venus, Venus Merger Sub, VIYI and WiMi on June 10, 2021. Pursuant to the terms of the Merger Agreement, the Venus Merger Sub will merge with and into VIYI, with VIYI being the surviving entity and becoming a wholly owned subsidiary of Venus. Venus shall continue to be publicly listed and will change its name to “MicroAlgo Inc.” after the consummation of the Business Combination. New Venus refers to Venus immediately following the consummation of the Business Combination.

The aggregate consideration for the Business Combination is $400,000,000, payable in the form of approximately 39,603,961 newly issued Venus ordinary shares to VIYI shareholders. At the closing of the Business Combination, the issued and outstanding shares in VIYI held by VIYI shareholders will be cancelled and ceased to exist, in exchange for the issue of an aggregate of 39,603,961 New Venus Ordinary, among which approximately 792,079 Venus ordinary shares to be issued to WiMi will be held in escrow to satisfy any indemnification obligations incurred under the Merger Agreement.

Immediately prior to the effective as of the closing of the Business Combination, the board of directors of Venus will consist of five members, four of whom will be nominated by VIYI. In order to continue to satisfy Nasdaq Capital Market listing standards, at least three of the members of the board of directors will be independent in accordance with Nasdaq listing rules. See section titled “Venus’ Directors and Executive Officers after the Business Combination” for additional information.

According to the Amended and Restated Memorandum and Articles of Association of New Venus, the authorized share capital of post-closing company will be $200,000 divided into 200,000,000 ordinary shares of par value of $0.001 each.

After the Business Combination, assuming there are no redemptions of Venus’ shares, Venus’ current public shareholders will own approximately 10.97% of the issued share capital of New Venus, Venus’ current directors, officers and affiliates will own approximately 3.03% of the issued share capital of New Venus, and VIYI shareholders will own approximately 85.84% of the issued share capital of New Venus. Assuming redemption by holders of 2,300,000 Venus’ outstanding ordinary shares, Venus’ current public shareholders will own approximately 6.30% of the issued share capital of New Venus, Venus’ current directors, officers and affiliates will own approximately 3.19% of the issued share capital of New Venus, and VIYI shareholders will own approximately 90.34% of the issued share capital of New Venus. Assuming the Business Combination Proposal is approved, Venus expects to close the Business Combination by [September 30, 2022].

VIYI and WiMi make certain representations and warranties (with certain exceptions set forth in the disclosure schedule to the Merger Agreement) relating to VIYI on the following aspects: (1) corporate existence and power, (2) authorization, (3) governmental authorization, (4) non-contravention, (5) capital structure, (6) organizational documents, (7) Subsidiaries, (8) financial statements, (9) books and records, (10) absence of certain changes, (11) properties, title to the Company’s assets, (12) litigation, (13) contracts, (14) licenses and permits, (15) compliance with laws, (16) compliance with anti-corruption laws, (17) intellectual property, (18) employees, (19) employment matters, (20) tax matters, (21) environmental laws, (22) finders’ fees, (23) status as not an investment company, (24) Affiliate transactions, (25) Proxy Statement.

Venus and Venus Merger Sub make certain representations and warranties on the following aspects: (1) corporate existence and power, (2) authorization, (3) governmental authorization, (4) non-contravention, (5) finders’ fees, (6) issuance of shares, (7) capitalization, (8) information supplied, (9) trust account, (10) listing on Nasdaq, (11) board approval, (12) Venus’ SEC documents and financial statements, (13) litigation, (14) compliance with laws, (15) compliance with anti-corruption and sanction laws, (16) not an investment company, (17) tax matters, (18) contracts, (19) business activities, (20) proxy statement, (21) no outside reliance. Venus and Venus Merger Sub make no representation or warranty on other aspect.

VIYI agreed to the following additional covenants: (1) compliance with laws, (2) delivery of the requisite PCAOB Financials for the quarter ending June 30, 2021 no later than August 15, 2021, and (3) waive claims against trust account money.

Venus and Venus Merger Sub agreed to the following additional covenants: (1) from the date of the Merger Agreement through the effective time of the Business Combination, to ensure Venus’ listing on Nasdaq and to reserve new trading symbol prior to the effective time of the Business Combination, (2) from the date of the Merger Agreement through the closing, keep current and timely file all SEC filings and comply with its reporting obligations, (3) appropriate disbursement of Trust Account funds, (4) election of Venus’ directors and officers in accordance with the composition contemplated under the Merger Agreement, (5) indemnification and insurance coverage for director and officers of VIYI and Venus, (6) adopting Section 16 board resolutions, (7) notifying VIYI of any shareholder litigation and (8) delivery of the finalized consideration allocation statement.

In addition, Venus agreed to prepare and file a proxy statement on with the SEC to provide for (i) approval of the Business Combination and related transactions contemplated by the Merger Agreement; (ii) the election of new directors in accordance with the Merger Agreement; (iii) approval of issuance of shares to VIYI shareholders; (iv) approval by Venus shareholders of an increase in the authorized share capital to 200,000,000 shares; (v) approval of a name change to MicroAlgo Inc.; (vi) approval of amendment of Memorandum and Articles of Association.

The Merger Agreement may be terminated by either Venus and Venus Merger Sub or VIYI if Closing has not occurred by Novermber 11, 2022.

Venus and Venus Merger Sub may terminate the Merger Agreement by written notice to VIYI if VIYI has materially breached any covenant, agreement, representations and warranties and failed to cure such breach within 15 days after notification of breach.

VIYI may terminate the Merger Agreement by written notice to Venus and Venus Merger Sub if any of them has materially breached any covenant, agreement, representations and warranties and failed to cure such breach within 15 days after notification of breach.

Combination at a price per share of no greater than the redemption price per share plus an agreed upon premium above such redemption price; and in each case waiving the redemption rights associated with any ordinary shares so purchased. As of the date hereof, no replacement backstop investor has been identified.

In connection with the transactions, Venus, WiMi and an escrow agent will enter into an Escrow Agreement pursuant to which 792,079 Venus ordinary shares to be issued by Venus to WiMi will be held in escrow to secure the indemnification obligations as contemplated by the Merger Agreement. The form of Escrow Agreement shall be in the customary form used by such escrow agent for similar transactions consistent with the terms of the Merger Agreement.

In connection with the transactions, Venus and each VIYI shareholder have entered into a Company Transaction Support Agreement as of June 10, 2021, pursuant to which VIYI shareholders agreed, among other things, (i) not to redeem any of Venus ordinary shares which may be owned by them which may be acquired prior to the closing of the Business Combination; (ii) to vote at any meeting of shareholders of Venus and VIYI all such Venus ordinary shares or VIYI ordinary shares, as the case may be, in favor of the Business Combination and the transactions contemplated by the Merger Agreement and in favor of the other proposals contained in the Venus proxy statement; (iii) to be bound by certain other covenants and agreements related to the Business Combination and (iv) to be bound by certain transfer restrictions with respect to such VIYI ordinary shares prior to the Closing, in each case, on the terms and subject to the conditions set forth in the Company Transaction Support Agreement.

When you consider the recommendation of Venus board of directors in favor of approval of the Business Combination Proposal and the other related Proposals, you should keep in mind that Venus’ directors and officers have interests in the Business Combination that are different from, or in addition to, your interests as a shareholder, including the following:

The Business Combination will be accounted for as a reverse merger in accordance with U.S. GAAP. Under this method of accounting, Venus will be treated as the “acquired” company for financial reporting purposes. This determination was primarily based on the holders of VIYI expecting to have a majority of the voting power of the post-combination company, VIYI senior management comprising all of the senior management of New Venus, the relative size of VIYI compared to Venus, and VIYI operations comprising the ongoing operations of the New Venus. Accordingly, for accounting purposes, the Business Combination will be treated as the equivalent of VIYI issuing shares for the net assets of Venus, accompanied by a recapitalization. The net assets of Venus will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination will be those of VIYI.

Prior to the consummation of Venus’ IPO on February 11, 2021, neither Venus, nor anyone on its behalf, had contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a transaction with Venus.

The following is a brief description of the background of Venus’ search and discussion with various potential target companies.

From the consummation date of Venus’ IPO through June 10, 2021, the execution date of the Merger Agreement with VIYI, Venus considered a number of potential target companies with the objective of consummating a business combination. Venus’ representatives contacted and were contacted by a number of individuals and entities who offered to present ideas and opportunities for a business combination, including financial advisors and companies that have their operations in either the United States, Canada or Asia. Venus compiled a list of high priority potential targets and updated and supplemented such list from time to time. Such list was periodically shared, in depth, with the Venus Board.

Venus reviewed and evaluated the potential targets based on the investment criteria set forth in its IPO proxy statement. However, these criteria are not intended to be exhaustive, and Venus was looking for factors with respect to potential targets including but not limited to (i) established middle-market businesses with proven track records, (ii) experienced management teams and strong competitive positions with, or with the potential for, revenue, and (iii) earnings growth and strong cash flow generation. Venus focused on companies exhibiting secular growth or the potential for a near-term cyclical uptick, and within those sectors, companies that would benefit from being a publicly traded company.

On or about February 10, 2021, Venus formed a search team led by Yanming Liu, its Chief Executive Officer, and River Chi, its Chief Financial Officer, to start searching for target companies. In February 2021, Venus engaged Lou Zhong and Karen Ding in China to support its management team. Mr. Lou Zhong worked at Deloitte as an auditor for 3 years and Haitong Securities as a project manager for 3 years. He has more than 9 years of experience in audit and investment banking. Ms. Karen Ding worked at Jupai Holding, a wealth management service provider, as a project manager for 2 years and Deloitte as an auditor for 2 years. She has 7 years of experiences in audit and capital markets. Based on the extensive business connections and industry insights, Venus was introduced to various potential acquisition targets that might potentially meet the Venus management team’s preliminary target selection criteria. Venus’ search team reviewed, among others, the financial performance, management team, business industry and a description of each initial candidate. Following such initial review, Venus’ search team selected preliminary qualified candidates and continued with second stage review by conducting conference calls and/or on-site visits and in-person meetings with the management of candidates, and collecting more detailed business information from these candidates.

From February 2021 to May 2021, Venus held many internal meetings to discuss preliminary candidates. At each meeting, Venus reviewed and discussed the qualifications of those candidates and prioritized companies based on the criteria described above. In reviewing over 30 potential targets in those four months, and holding discussions with their respective management, Venus provided an initial non-binding indication of interest to 4 potential acquisition targets before Venus identified VIYI as a preferred acquisition target.

Company A: In February 2021, Company A, which is not affiliated with Venus or to any affiliated business entities of Venus, was referred to Venus’ search team through a financial advisor for Company A. Company A is an Education and Human resource Group in China. On February 9, 2021, after reviewing business introduction and models of Company A, and discussing with the management of Company A, Venus’ management team established Company A as a merger candidate based upon a preliminary due diligence review and entered into a letter of intent with Company A on February 19, 2021. Venus conducted additional due diligence on Company A from February 2021 through March 2021 reviewing Company A’s information as it became available. Venus removed Company A from the priority list of candidates in March 2021 because Venus concluded that Company A would not attract investors in the public market.

Company B: In February 2021, Company B, which is not affiliated with Venus or any affiliated business entities, was referred to Venus’ search team through a financial advisor for Company B. Company B is a personalized medical company based in Denmark, which has 6 clinical-stage anti-cancer drugs that address

significant cancer markets within one Pre-NDA, 4 Phrase II and I Phase I programs respectively and (ii) provides self-developed DRP platform. On February 13, 2021, after reviewing basic information of Company B and holding meetings with its management, Venus’ management team established Company B as a potential merger candidate and submitted Company B’s information to Venus’ Board. On February 19, 2021, Venus entered into a letter of intent with Company B after receiving approval from Venus’ Board. From February to March 2021, Venus conducted due diligence involving examining Company B’s financial information, share structure and business model. In March 2021, Venus removed Company B from the priority list of candidates due to the expectation that Company B’s valuation is much higher than fair market price as evaluated by Venus’ team.

Company C: In February 2021, Company C, which is not affiliated with Venus or any of its affiliated business entities, was referred to Venus’ management team by a financial advisor of Company C. Company C is a SaaS service provider focused on data management system, customizing mobile software and cloud service. On February 20, 2021, after reviewing basic information of Company C, Venus’ management team established Company C as a candidate and submitted Company C’s information to Venus’ Board on that day. After an on-site visit and discussion with the management, Venus entered into a letter of intent with Company C on March 4, 2021. Venus subsequently conducted due diligence and reviewed the business model and financial needs of Company C. In March 2021, Venus removed Company C from its priority list of business merger target candidates because the valuation requested by Company C was significantly higher than what Venus considered fair.

Company D: In March 2021, Company D, which is not affiliated with Venus or any affiliated business entities, was referred to Venus’ management team by a financial advisor who works in capital markets. Company D is a leading full-service operator for global personal care products entering China market. On March 15, 2021, Venus’ management team visited Company D’s office, reviewed basic information of Company D and had a conference call with its management. As a result, Venus’ management team established Company D as a candidate and entered into a letter of intent with Company D on March 22, 2021, with an exclusivity period to April 10, 2021 (the “Exclusivity Period”). From March through April 2021, Venus continued its due diligence on Company D, reviewed Company D’s financial and business forecasting as well as held further discussions with Company D. In April 2021, Venus decided to remove Company D from its priority list of candidates because Company D decided to pursue alternative funding strategies.

On February 28, 2021, Mr. Li He, CFO of VIYI, proposed VIYI as a potential business combination target to Venus. On the same day, Mr. Li He sent VIYI’s business presentation to Venus’ management team.

On March 1, 2021, Venus and Mr. Li He discussed the merits and characteristics of a potential business combination with VIYI. An introduction conference call was held between Venus’ management and VIYI’s management team. On the same day, a confidentiality agreement was entered into between VIYI and Venus to facilitate discussions regarding a business combination transaction.

From March 2, 2021 to March 9, 2021, a few conference calls took place between Venus and VIYI, Venus then had a general understanding of VIYI’s operations, products, services, business structure and key technologies in the central processing algorithm solution industry.

On March 10, 2021, VIYI sent its latest full version business presentation to Venus so that it may better understand VIYI’s business and to engage in further discussion with respect to a potential business combination.

On April 12, 2021, a conference call was held between Venus’ management and VIYI’s management team, discussing VIYI’s commercial and capital-raising plans and, the prospects for a business combination. After the call, a working group list was set up and a due diligence request was sent by to VIYI.

On April 13, 2021, VIYI granted Venus access to its data-room, where VIYI’s detailed annual and interim reports, summarized financial information, legal documents, material agreements and business forecasting of VIYI were located.

From April 14, 2021 to April 16, 2021, Venus put forward a request for some supplementary materials and a series of discussions were held between Venus and VIYI about the material contracts and the development of the business.

On April 20, 2021, Venus hired Shanghai PKF Certified Public Accountants Co., Ltd as a financial consultant to conduct financial due diligence for VIYI.

From April 25 to April 28, 2021, Mr. Yanming Liu, CEO of Venus, along with Venus’ team and Deheng Law offices, Chinese counsel for Venus, conducted an on-site due diligence review at VIYI’s office in Shenzhen, China, which included but was not limited to reviewing corporate documents, operations, financial information, business plan, and other material agreements. Deheng also conducted legal due diligence and sat in interviews between Venus’ team and VIYI’s management, customers, suppliers as well as auditors. At the same time, VIYI, together with DLA Piper UK LLP, its US counsel, conducted due diligence on Venus, including a review of its publicly filed SEC reports and interviews with Venus’ management and counsel.

On April 29, 2021, a discussion between VIYI and Venus was held by a conference call where both parties proposed certain terms to be included in a draft of non-binding letter-of-intent (LOI) for the business combination of Venus and VIYI. In addition, Venus made it clear in the LOI that signing a definitive merger agreement would be subject to the satisfactory completion of the due diligence.

On April 30, 2021, VIYI provided a valuation model, including the company’s forecast and comparable companies. VIYI told Venus about their expectation of the initial valuation, and they were confident that there would be strong third-party investment demand at the time of the Business Combination. In addition, VIYI requested to reduce the number of board of directors for the combined company as proposed by Venus, and requested to reduce the number of shares to be put in escrow for indemnification.

During the period from April 30, 2021 to May 5, 2021, Venus and VIYI held multiple discussions, where the parties negotiated the outstanding terms of the Business Combination, including the valuation range and post-transaction corporate governance, as well as the timetable to complete the transaction, and related steps necessary to complete due diligence by both parties.

On May 7, 2021, VIYI proposed some of the changes regarding to the letter of intent, including: (i) number of the board of directors nominated by Venus; (ii) cancelled the equity incentive plan, (iii) cancelled all the escrow shares of the transaction.

On the same day, the Board of Venus made a decision to engage KKG to provide a fairness opinion to the Board of Directors of Venus in connection with the proposed merger with VIYI. The reason Venus’s Board of Directors decided to obtain a fairness opinion was because during the negotiation of the valuation under the Merger Agreement, the Board of Directors determined that it was prudent and in the best interests of Venus and its shareholders to engage an independent valuation consultant with relevant experience to provide a professional opinion as to whether the transaction is fair to all shareholders of Venus and its view of the potential valuation of VIYI. Venus engaged King Kee Appraisal and Advisory Limited as a consultant to assist Venus in evaluating VIYI’s fair enterprise value.

On May 8, 2021, Venus replied to VIYI with certain changes in the LOI, changes included giving Venus one spot on the board of directors of the combined company (as Venus insisted) and maintaining certain escrow shares for the purpose of protecting Venus’ public shareholders.

On May 9, 2021, VIYI proposed a new change to the LOI about the termination terms, which stipulated that Venus could not terminate the transaction at any time but after the expiration of the Exclusivity Period.

On May 10, 2021, Venus accepted the change made by VIYI on May 9, 2021 and both parties continued to negotiate the terms regarding Venus’ seat on the board of directors for the combined company as well as the percentage of escrow shares. On the same day, a conference call was held between Venus, Deheng, PKF and King Kee, discussing the result of the due diligence and the fair enterprise value for VIYI.

On May 11, 2021, VIYI and Venus managed to resolve all major commercial terms in the LOI.

On the evening of May 11, 2021, VIYI forwarded a non-binding LOI to Venus, which was accepted and returned by Venus on the same day.

During the period from May 12 to May 17, 2021, multiple conference calls were held among Venus, Becker, U.S. counsel to Venus, VIYI, DLA Piper UK LLP, U.S. counsel to VIYI, and Friedman LLP. These meetings covered the following topics (i) introduction of each party, (ii) current status of the audit of VIYI’s financial statements under U.S. GAAP, and (iii) a proposed detailed timeline to carry forward the process of the Business Combination.

On May 17, 2021, the Board of Directors of Venus held a Zoom conference call meeting with KKG to review and discuss KKG’s analysis of the potential valuation of VIYI and the fairness of the proposed transaction to Venus’ shareholders.

On May 19, 2021, all parties of the Merger held a conference call to discuss issues surrounding the proposed deal structures, SEC registration, proxy statements, Nasdaq listing and due diligence. Key topics included: (i) the merger structure, (ii) the post-completion capitalization table, (iii) the merger agreement and (iv) expenses issues.

On the same day, Becker sent Venus a proposed draft of the Backstop Agreement pursuant to which investors would agree to commit to fund Venus in the event of redemptions of shares permitted under Venus’ organizational documents in connection with a business combination. The Backstop Agreement sought to ensure adequate capital in the combined company after the Business Combination. Becker then forwarded the proposed Backstop Agreement to VIYI and its counsel, DLA Piper.

On May 20, 2021, DLA Piper started to work on a draft of a definitive Merger Agreement reflecting the deal structure.

On the same day, Becker started to draft the proxy statement and provided the timeline for the initial preliminary proxy filing, definitive proxy filing and meeting date for the Extraordinary General Meeting.

On May 22, 2021, DLA Piper emailed the first draft of the Backstop Agreement to Venus and Becker to review.

On May 24, 2021, Venus and VIYI, together with their respective counsels, discussed the various legal and commercial issues in the Merger Agreement. Key topics included shareholders’ representation and warranties, break-up fees, minimum cash closing condition, backstop arrangement and responsibility, trust extension logistics and responsible party, D & O indemnification, requirements of PRC legal opinion and indemnity. DLA will work on merger agreement and proxy statement, Becker will be responsible for reviewing, updating, and completing information required with respect to Venus (including offering statistics, share ownership structure, proposals, related party transaction, business etc.) The timeline is that the Merger Agreement will be signed by June 15 and proxy statement to be prepared concurrently and filed later.

On May 26, 2021, DLA sent an updated proxy statement and Merger agreement for all parties to review, Becker gave its comments on the same day which mainly about the merger structure, registration statement and the minimum liquidation requirement of Nasdaq.

During the period between May 27, 2021 to May 31, 2021, Venus and VIYI’s management teams and their respective advisors held many calls to negotiate the terms of various transaction documents, including: (i) the definitive Merger Agreement, (ii) Backstop Agreement, (iii) Disclosure Letter, (iv) Lock-up Agreement, (v) Sponsor Voting Agreement, and (vi) other ancillary agreements. During those negotiations, the parties discussed the valuation range and transaction expenses. Venus conducted its own preliminary analysis and deemed the proposed valuation to be acceptable, subject to further due diligence and a fairness opinion prepared by a reputable, independent valuation expert selected by Venus and reasonably acceptable to VIYI (and for which King Kee had been retained). VIYI also communicated with the potential Backstop Investors about the transaction terms in order to get approval for the proposed Backstop Agreement.

On June 1, 2021, DLA sent VIYI’s draft (i) board and (ii) shareholder resolutions for the transaction for both parties to review. At the same day, DLA and Becker discussed few open items include drafts for the (i) escrow agreement, (ii) company support agreement, and (iii) Venus post-Closing memorandum and articles.

On June 2, 2021, Becker sent back the merger agreement with its comments on the Indemnification, escrow amount and the lock-up period.

On June 3, 2021, Becker draft the press release and Form 8-K for both parties to review. Also Becker provided the Transaction Support Agreement for Venus. DLA sent the disclosure schedule for Venus and Becker to review at the same day.

From June 4, 2021 to June 7, 2021, a few conference calls were held among Venus’ and VIYI’s management team and their respective advisors to discuss the open items for all the documents related to the merger agreement.

Venus management conducted its own preliminary analysis during this period. On June 7, 2021, the Board of Directors of Venus held a conference call meeting with KKG to further review their analysis of the fairness opinion in connection with the proposed merger with VIYI. KKG provided a draft opinion at such time to the Venus Board.

On the same day, Venus and VIYI had a discussion on the mechanism for any backstop investment. In addition, Venus, Becker and DLA had a discussion regarding some comments on disclosure schedules to be provided by VIYI. DLA identified a few items as disclosed in VIYI’s disclosure schedules for Venus’ consideration.

On June 8, 2021, Venus’ management advised its board of directors on the progress of the VIYI transaction. The board package included a near final draft of Merger Agreement, VIYI’s audited and unaudited financial statements, and a preliminary assessment of valuation presentation prepared by King Kee.

On June 9, the Venus board of directors held a special board meeting to review the transaction with VIYI. The Venus board discussed transaction with a focus on VIYI business model and the transaction valuation.

On the same day, Venus, VIYI, Becker and DLA Piper had a discussion on the final outstanding issues relating to the Merger Agreement. Venus and VIYI managed to agree on all major commercial issues, including survival period of indemnification obligations, lockup agreement as a closing condition, and backstop agreement.

VIYI’s board of directors approved the transaction on June 9, 2021 and authorized VIYI to enter into the definitive agreement with Venus and certain other parties for the purpose of consummating a business combination. On the same day, the VIYI shareholders also approved the Business Combination.

On June 10, 2021, Venus’ board of directors approved the transaction and authorized Venus management to enter into the definitive agreement with VIYI and certain other parties for the purpose of consummating a business combination. On the same day, KKG rendered its opinion letter to the Board of Directors of Venus that, as of June 10, 2021, the date of the opinion letter, and based upon and subject to the factors and assumptions set forth therein, including the assumption of no redemptions by Venus public shareholders, that the consideration to be paid by Venus in connection with the Business Combination pursuant to the Merger Agreement is fair, from a financial point of view, to Venus and its shareholders. The fairness opinion of KKG addresses fairness to all shareholders of Venus as a group as opposed to only those shareholders unaffiliated with the Sponsor of Venus or its affiliates.

On June 10, 2021, Venus entered i) Merger Agreement among with Viyi Algorithm Inc., Venus Merger Sub Corp. and WiMi Hologram Cloud Inc.; ii) Registration Rights Agreement; iii) Backstop Agreement with Ever Abundant Investments Limited and (iv) Company Transaction Support Agreement and filed 8-K on the same day.

During the period between June 10, 2021 to January 7, 2022, Venus, Becker, U.S. counsel to Venus, VIYI, DLA Piper UK LLP, U.S. counsel to VIYI, and Friedman LLP held a series of calls, drafting and revising the Registration Statement. Venus filed the Registration Statement, Amendment No. 1, 2, 3 and 4 of Registration Statement on June 29, 2021, September 3, 2021, October 6, 2021, December 23, 2021 and January 7, 2022 relatively.

On January 19, 2022, based on the discussion between Venus and VIYI’s management team, Becker drafted the new Backstop Agreement with WiMi Hologram Cloud Inc., who replaced Ever Abundant Investments Limited as the new backstop investor, and the backstop investment amount also raised from US$10 million to US$15 million.

At the same time, Merger Agreement was amended accordingly, including but not limited to the revision of extending the outside termination date of the proposed merger, potential governmental approvals, and Backstop Investment.

During the period between January 19, 2022 to January 23, 2022, Becker and DLA had several conference calls regarding to Merger Agreement and Backstop Agreement. Becker drafted the 8-K for both parties to review as well.

On January 24, 2022, Venus filed 8-K, including i) Amendment No. 1 to Merger Agreement; ii) Backstop Agreement with WiMi Hologram Cloud Inc. And iii) Termination of Backstop Agreement with Ever Abundant Investments Limited.

From July 18, 2022 to July 27, 2022, Becker and DLA had several conference call regarding the amendment to the Merger Agreement. Becker drafted the 8-K for both parties to review as well. On August 2, 2022, Venus filed Form 8-K to report the amendment No. 2 to the Merger Agreement.

On August 3, 2022, Becker and DLA discussed the automatic termination of the Backstop Agreement on June 30, 2022 and proposed to further amend the Merger Agreement to reflect the removal of the issuance of Venus shares to the Backstop Investor. Becker drafted the Amendment No. 3, and Form 8K for both parties to review. On August 3, 2022, Venus filed Form 8-K to report the amendment No. 3 to the Merger Agreement.

In addition to the foregoing factors, the Board of Directors of Venus also considered the fairness opinion and supporting analysis provided by an independent valuation consultancy, KKG Appraisal and Advisory Limited (“KKG”). KKG provides valuation and advisory services in connection with financings, and mergers and acquisitions for both public and private companies to institutions and individuals. KKG was selected to provide the opinion based on their experience in and knowledge of the mobility industry and their ability to complete the assignment in a timely manner. Pursuant to a letter agreement dated May 7, 2021, Venus retained KKG to provide a fairness opinion to the Board of Directors of Venus in connection with the proposed merger with VIYI. Under the terms of the engagement agreement, KKG received a flat fee of $80,000 which has been paid in full. There are no contingent or other fees or compensation payable to KKG. None of KKG, its associates or affiliates, is an insider, or holds any securities of Venus or any of its affiliates. KKG is not an advisor to any person or company with respect to the Transaction. Other than pursuant to the engagement agreement, KKG has not previously provided any financial advisory services to VIYI or Venus for which it has received compensation in the past two years. Other than the engagement agreement, there are no other understandings, agreements, or commitments among KKG, VIYI, and Venus.

On May 17, 2021 the Board of Directors held a Zoom conference call meeting with KKG to review their analysis and proposed some suggestions in selecting the comparable companies. On June 7, 2021, a conference call meeting was held between the Board of Directors and KKG to review their analysis of the fairness opinion in connection with the proposed merger with VIYI. Following the meeting, KKG rendered its opinion letter to the Board that, as of June 10, 2021, the date of the opinion letter, and based upon and subject to the factors and assumptions set forth therein, including the assumption of no redemptions by Venus public shareholders, that the consideration to be paid by the Company in connection with the Business Combination pursuant to the Merger Agreement is fair, from a financial point of view, to the Company and its shareholders.

In connection with rendering the opinion described above and performing its related financial analyses, KKG reviewed and performed the following, among other things:

KKG also held discussions with management of both Venus and VIYI regarding their assessment of past and current business operations, financial condition and future prospects.

For purposes of rendering the fairness opinion described above, KKG relied upon and assumed the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting, and other information provided to, discussed with or reviewed by KKG, without assuming any responsibility for independent verification thereof. In that regard, KKG assumed that the forecasts provided were reasonably prepared on a basis reflecting the best currently available estimates and judgments of Venus’s and VIYI’s management. KKG also assumed that the transactions contemplated by the Merger Agreement will be consummated on the terms set forth in the Merger Agreement, without the waiver or modification of any term or condition, the effect of which would be in any way meaningful to its analysis.

KKG’s opinion does not address the underlying business decision of Venus to engage in the transaction contemplated by the Merger Agreement, or the relative merits of the transaction contemplated by the Merger Agreement as compared to any strategic alternatives that may be available to Venus; nor does it address any legal, regulatory, tax or accounting matters. KKG expressed no opinion or view as to any terms or other aspects of the Business Combination, including, without limitation, the form or structure of the Business Combination or any ongoing obligations of the parties pursuant to the Merger Agreement. KKG’s opinion addresses only the fairness, from a financial point of view, to the holders of Venus as of June 10, 2021, of the Merger Consideration to be paid to the shareholders of VIYI pursuant to the Merger Agreement. KKG’s opinion was necessarily based on economic, monetary, market, and other conditions as in effect on, and the information made available to KKG as of, the date of the opinion and KKG assumed no responsibility for updating, revising or reaffirming its opinion based on circumstances, developments or events occurring after the date of its opinion. The issuance of KKG’s opinion was approved by a fairness opinion review committee of KKG.

The following is a summary of the material financial analyses delivered by KKG to the Board of Directors of Venus in connection with rendering the fairness opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by KKG, nor does the order of analyses described represent the relative importance or weight given to those analyses by KKG. The financial analyses summarized below include information presented in tabular format. In order to fully understand the financial analyses performed by KKG, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses performed by KKG. Considering the data set forth in the tables below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of the financial analyses performed by KKG. Except as otherwise noted, the following information, to the extent that it is based on market data, is based on market data as it existed on or before June 10, 2021, the date of the opinion letter and is not necessarily indicative of current market conditions.

KKG primarily used three customary approaches in conducting its analyses and arriving at its opinion, including a comparison to guideline public companies, a comparison to guideline transactions, and discounted cash flow analyses.

In determining the market multiple, a list of comparable companies was identified. The selection criteria include: the companies derive most, if not all, of their revenues from the same industry or closely related industry of the VIYI; the comparable companies are publicly listed in the US and searchable in Bloomberg.

The details of the comparable companies which are considered as fair and representative samples are listed below:

For purposes of the analysis, KKG analysed the following trading statistics for each of the select guideline public companies for comparison purposes and to assess the value of VIYI. Price/Sales Ratios (“P/S”), as a multiple of Trailing 12-month (TTM). The selected companies and their financial metrics were:

After taking into consideration the comparative data for the select guideline public companies and VIYI, appropriate valuation discounts and adjustments, KKG used median multiples including appropriate discounts and adjustments and applied them to VIYI’s 2020 results and 2021 forecasts. This analysis resulted in a wide range of equity values of between $4.26 million to $1.63 billion. With the Median ratio at an EV/Revenue of 8.89 multiple, the valuation of VIYI seemed fair and reasonable and may bring potentially increased value to Venus’ shareholders.

No company in the KKG’ analysis is identical or directly comparable to VIYI, therefore an evaluation of the results of this analysis is not entirely mathematical. Rather, the KKG’ analysis involves complex considerations and judgments concerning differences in financial and operating characteristics and other factors that could affect the public trading or other values of the companies to which VIYI was compared.

Discounted Cash Flow Analysis — Using forecasts provided by VIYI management for the fiscal years ending 2021 – 2025, KKG performed discounted cash flow analyses to calculate the estimated present value of the standalone unlevered, after-tax free cash flows forecasted to be generated by VIYI for the forecast period.

KKG calculated terminal values for VIYI by applying the median revenue and EBITDA transaction multiples to terminal year estimated unlevered, after-tax free cash flows. The unlevered free cash flows and terminal values were then discounted to present value using discount rates of 20.0%, which were based on an estimate of VIYI’s weighted average cost of capital, or discount rate.

Based on KKG’ experience and judgment in performing valuation analyses and the greater availability and relevancy of revenue multiple data derived from transactions, KKG relied more on its revenue multiple analyses to measure the intrinsic value of the equity.

KKG’ analysis resulted in the equity values of $400 million, which support the consideration contemplated in the Merger Agreement.

The following is a summary of the material financial analyses reviewed by Venus in connection with the valuation of VIYI. The summary set forth below does not purport to be a complete description of the financial analyses reviewed or factors considered by us nor does the order of the financial analyses described represent the relative importance or weight given to those financial analyses reviewed by the Board of Directors. We may have deemed various assumptions more or less probable than other assumptions, so the reference ranges resulting from any particular portion of the analyses summarized below should not be taken to be our view of the actual value of VIYI.

Venus reviewed certain financial information of VIYI and the structure of the proposed Business Combination. Venus also reviewed the analyses described above that were prepared by KKG, which included a financial review of certain publicly-traded companies selected by KKG for the reasons discussed above in the guidelines public company and guideline transaction analyses. The identity of the companies that were evaluated in KKG’s analyses is provided above. Venus’s Board of Directors had a series of conference call discussions and meetings from April 2021 to June 2021 and reviewed VIYI management’s forecast and its existing business and business plan. Venus engaged KKG to undertake multiple analyses of VIYI and the opportunity presented by the Business Combination, including a guideline public company analysis and a discounted cash-flow analysis, each as discussed in greater detail above and Venus reviewed and relied on such analyses.

The projections regarding VIYI’s future performance and the review by Venus’s Board of Directors reflect and consider numerous assumptions made by VIYI management, including material assumptions regarding, among other things,

The VIYI projections were prepared during the months of March and April 2021 by taking into account the following:

The competitive landscape was analyzed, to assess the addressable market and to forecast the future various applications. The timeframe leading out to 2025 was selected through an analysis of: (i) recent market trends, (ii) the increasing application scenarios of bespoke central processing algorithm service, and (iii) market consolidation in the algorithm sector. The goal was to use a timeframe that led to a more stable, mature and predictable business landscape.

Based on the above, VIYI maintains a 5-year business plan on a rolling basis; in detail, every twelve months VIYI analyzes the discrepancies, if any, between actual and forecast and it calibrates the 5-year business plan, accordingly.

During the forth quarters of 2020, VIYI experienced strong growth in intelligent chips and services revenues. As for the projections, the rapid increase in revenues is mainly driven by the expectation that such growth will continue and the continuing growth in the algorithm services provided to internet advertisement and online gaming acceleration industries with additional application scenarios of Government cloud computing, Manufacturing industry, Financial technology, Medical cloud computing, Smart transportation, PaaS 3D and Central processing algorithm cloud service for enterprise (SAAS) marketing.

For purposes of evaluating VIYI’s financial condition and in connection with the preparation by VIYI of its projections, Venus management was provided with documents from VIYI including projections for various time periods, including for the years ended December 31, 2021 through 2025, copies of material contracts, summaries of various industry analysis and trends and forecasts, information related to governmental regulations which may affect payments and collections rates and information related past performance. Additionally, the Board of Venus reviewed and discussed with KKG its analysis in rendering the fairness opinion described above.

VIYI provided Venus with its internally prepared forecasts for each of the calendar years in the five-year period ending December 31, 2025. Venus and VIYI do not, as a matter of general practice, publicly disclose long-term forecasts or internal projections of their future performance, revenue, financial condition or other results. However, in connection with the proposed Business Combination, management of VIYI prepared the financial projections set forth below to present key elements of the forecasts provided to Venus. Venus is including the following summary of certain VIYI internal, unaudited prospective financial information from VIYI’s management team’s projections for the combined post-merger company solely because that information was made available to Venus’s Board in connection with the evaluation of the Business Combination. In the view of VIYI’s management team, such forecasts were prepared on a reasonable basis, reflected the best currently available estimates and judgments and presented, to the best knowledge and belief of VIYI’s management, the expected course of action and the expected future financial performance as of the date that such projections were made. However, this information is not fact and should not be relied upon as being necessarily indicative of future results, and readers of this proxy statement are cautioned not to place undue reliance on the projections.

Neither VIYI’s independent auditors, nor any other independent accountants, have compiled, examined, or performed any procedures with respect to the projections contained herein, nor have they expressed any opinion or any other form of assurance on such information or its achievability, and assume no responsibility for, and disclaim any association with, the projections.

The projections are forward-looking statements that are based on assumptions and estimates that are inherently uncertain and, though considered reasonable by VIYI’s management as of the date of its preparation, are subject to a wide variety of significant business, economic, industry, and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the prospective financial information, including, among others, risks and uncertainties, as described in the “Risk Factors” and “Cautionary Statement Regarding Forward-Looking Statements.” The projections are subjective in many respects; and since the projections cover multiple years, that information by its nature becomes less predictive with each successive year. Accordingly, there can be no assurance that the prospective results are indicative of the future performance of VIYI or that actual results will not differ materially from those presented in the projections. Furthermore, the projections do not take into account any circumstances or events occurring after the date that information was prepared.

The projections were requested by, and disclosed to, Venus for use as a component in its overall evaluation of VIYI and are included in this proxy statement on that account. The inclusion in this proxy statement of the Venus forecasts and of certain analyses referencing such forecasts should not be seen as an indication that VIYI, Venus or their respective boards of directors, management, affiliates, advisors, or any other related parties consider the forecasts predictive of actual future financial performance or events, and such forecasts should not be relied upon as such. All such parties cannot provide any assurance whatsoever that actual results will be consistent or even partially consistent with the forecasts provided. Indeed, actual results may differ profoundly from projections due to various uncertainties, and none of aforementioned parties undertakes any obligation to update, revise, reconcile, or confirm or disconfirm any forecasts based on circumstances arising after the date at which listed forecasts were generated, based on future events or any other factors. None of VIYI or Venus or any of their respective affiliated parties intends to make publicly available any updates to the forecasts in this document, except as required by law. None of VIYI or Venus or any of their respective affiliated parties intends to make publicly available any updates to the forecasts in this document, except as required by law.

Further, the inclusion of financial projections in this proxy statement should not be regarded as an indication that Venus, VIYI, their respective boards of directors, or their respective affiliates, advisors or other representatives considered, or now consider, such financial projections necessarily to be predictive of actual future results or to support or fail to support your decision whether to vote for or against the Business Combination Proposal. You are cautioned that the projections solely represent VIYI’s best efforts in predicting future operating results and must be considered in that light. As a result, in making a decision regarding the Business Combination, please understand that the projections may be materially different than actual results. You are cautioned not to rely on the projections in making a decision regarding the transaction, as the projections may be materially different than actual results. Venus does not intend to reference these financial projections in its future periodic reports filed with the SEC under the Exchange Act.

The financial forecasts prepared by management of Venus and VIYI were not prepared with a view toward public disclosure nor prepared with a view toward compliance with the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information, or in accordance with GAAP. Neither the independent registered public accounting firm of VIYI nor of Venus nor any other independent accountant has audited, reviewed, compiled, examined or performed any procedures with respect to the unaudited prospective financial information for the purpose of its inclusion in this proxy statement, and accordingly, neither independent registered public accounting firm nor any other independent accountant expresses an opinion or provides any form of assurance with respect thereto. Due to inherent uncertainties in financial projections of any kind, stockholders are cautioned not to place undue reliance, if any, on the forecasts. Forecasts are subjective in nature and may not be realized, and reflect numerous assumptions made by management, including material assumptions regarding, among other things, market size, commercial efforts, industry performance, general business and economic conditions and numerous other matters that may not be realized and are subject to significant uncertainties and contingencies, all of which are difficult to predict and many of which are beyond the control of the preparing party.

There may be differences between actual and projected results, and the differences may be material. The risk that these uncertainties and contingencies could cause the assumptions to fail to be reflective of actual results is further increased by the length of time over which these assumptions apply. The failure to achieve assumptions and projections in early periods could have a compounding effect on the projections shown for the later periods. Thus, any such failure of an assumption or projection to be reflective of actual results in an early period could have a greater effect on the projected results failing to be reflective of actual events in later periods.

No assurances can be given that the unaudited prospective financial information and the underlying assumptions are reasonable or that, if it had been prepared as of the date of this joint proxy statement, similar assumptions would be used. In addition, the unaudited prospective financial information may not reflect the manner in which New Venus would operate the VIYI business after the merger. Venus, VIYI and their respective affiliates, advisors and representatives do not intend to, and each disclaims any obligation to, update or otherwise reconcile or revise the unaudited prospective financial information to reflect circumstances occurring since its preparation or to reflect the occurrence of future events, even in the event that any or all of the underlying assumptions are shown to be in error, or to reflect changes in general economic or industry conditions.

The financial projections reflect numerous estimates and assumptions with respect to general business, economic, industry, regulatory, market and financial conditions and trends and other future events, as well as matters specific to VIYI’s business, all of which are difficult to predict and many of which are beyond VIYI’s and Venus’s control. The financial projections are forward-looking statements that are inherently subject to significant uncertainties and contingencies, many of which are beyond Venus’s and VIYI’s control and VIYI’s limited operating history, diverse geographic markets and nascent industry make evaluating its business and future prospects, including the assumptions and analyses developed by VIYI upon which operating and financial results forecast rely, difficult and uncertain. The various risks and uncertainties include risks set forth in the sections entitled “Risk Factors.” As a result, there can be no assurance that the projected results will be realized or that actual results will not be significantly higher or lower than projected. Since the financial projections cover multiple years, such information by its nature becomes less reliable with each successive year. These financial projections are subjective in many respects and thus are susceptible to multiple interpretations and periodic revisions based on actual experience and business developments.

Furthermore, the financial projections do not take into account any circumstances or events occurring after the date they were prepared. None of VIYI’s independent registered public accounting firm, Venus’s independent registered public accounting firm or any other independent accountants, have compiled, examined or performed any procedures with respect to the financial projections included below, nor have they expressed any opinion or any other form of assurance on such information or their accuracy or achievability, and they assume no responsibility for, and disclaim any association with, the financial projections. Nonetheless, a summary of the financial projections is provided in this proxy statement because they were made available to Venus and Venus’s board of directors in connection with their review of the proposed Business Combination.

Neither Venus nor VIYI have warranted the accuracy, reliability, appropriateness or completeness of the projections to anyone, including to our Board. Neither Venus, Venus’s management nor any of Venus or VIYI’s representatives have made or make any representation to any person regarding the ultimate performance of New Venus compared to the information contained in the projections, and none of them intend to or undertake any obligation to update or otherwise revise the projections to reflect circumstances existing after the date when made or

to reflect the occurrence of future events in the event that any or all of the assumptions underlying the projections are shown to be in error. Accordingly, the projections should not be looked upon as “guidance” of any sort. VIYI will not refer back to these projections in its future periodic reports filed under the Exchange Act.

EXCEPT TO THE EXTENT REQUIRED BY APPLICABLE FEDERAL SECURITIES LAWS, BY INCLUDING IN THIS PROXY STATEMENT A SUMMARY OF THE FINANCIAL PROJECTIONS FOR VIYI, VENUS UNDERTAKES NO OBLIGATIONS AND EXPRESSLY DISCLAIMS ANY RESPONSIBILITY TO UPDATE OR REVISE, OR PUBLICLY DISCLOSE ANY UPDATE OR REVISION TO, THESE FINANCIAL PROJECTIONS TO REFLECT CIRCUMSTANCES OR EVENTS, INCLUDING UNANTICIPATED EVENTS, THAT MAY HAVE OCCURRED OR THAT MAY OCCUR AFTER THE PREPARATION OF THESE FINANCIAL PROJECTIONS, EVEN IN THE EVENT THAT ANY OR ALL OF THE ASSUMPTIONS UNDERLYING THE FINANCIAL PROJECTIONS ARE SHOWN TO BE IN ERROR OR CHANGE.

Financial measures provided to a financial advisor in connection with a business combination transaction are excluded from the definition of non-GAAP financial measures and therefore are not subject to SEC rules regarding disclosures of non-GAAP financial measures, which would otherwise require a reconciliation of a non-GAAP financial measure to a GAAP financial measure. Accordingly, we have not provided a reconciliation of such financial measures.

In light of the foregoing factors and the uncertainties inherent in these projections, stockholders are cautioned not to place undue reliance on these projections.

The key elements of the projections provided by VIYI’s management team to Venus are summarized in the table below with specific assumptions immediately following the table:

CPA segment: Revenues are projected based on expected number of customers for each period multiplied by expected average revenue per customer. VIYI uses historical number of customers and historical retention rate to project number of customers and factors in industry growth for the projection of new customers. Average revenue per customer is projected using historical rate of growth and in consideration of industry growth. The rate of growth is projected to increase in the initial years and decrease in later years. Going forward, VIYI’s CPA operation will mostly be carried out by VIYI’s direct subsidiaries, therefore the revenue of the VIE is not expected to be a major part of VIYI’s total revenues. See “— The markets VIYI operates its business are expected to maintain a rapid growth and Market demands for central processing algorithm solution develop rapidly” for details in the industry growth.

Intelligent chips segment: Revenues for resale of intelligent chips and accessories are based on number of intelligent chips and related accessories to be sold for each period multiplied by expected selling price. VIYI used the historical number of products sold to project the expected number of products to be sold. Average selling price is projected using average historical selling price. VIYI’s software development revenue is projected based on projected number of customers that will require VIYI’s services and the average contract price for VIYI’s existing customers.

CPA segment: Gross profit is projected based on projected revenue minus projected cost of revenue. Cost of revenue is projected based on historical costs of revenue of 2019 and 2020 which are mainly channel costs paid to channel distributors based on sales agreements and costs shared with content providers. VIYI projects margin to increase in initial years due to improvement in technologies and margin to trend down in later years due to rising costs.

Intelligent chips segment: Gross profit is projected based on projected revenue minus projected cost of revenue. Cost of revenue is based on projected units of chips to be sold multiplied by historical average cost of products sold. VIYI is projected to sell more CPU accessories in the coming years due to chip shortage which leads to higher projected margin. Gross profit for software development is projected based on contract price and the actual cost incurred based on 2020 and 2021 contracts.

CPA segment: Operating costs mainly consist of marketing, general and administrative expenses and research and development expenses. Research and development and sales and marketing expenses were projected to increase consistently with increase in VIYI’s revenue as VIYI operates in a competitive market that requires VIYI to invest substantially in its technology while general and administrative expenses are projected to increase in the initial years and remain relative stable in later years.

Intelligent chips segment: Operating costs mainly consist of marketing, general and administrative expenses and research and development expenses. VIYI projects its marketing, general and administrative expenses based on historical percentage of operating expenses to its revenue.

CPA segment: Projected EBITDA is projected based on gross profit minus operating expenses and adds back depreciation and amortization expenses. Depreciation expenses are not material for VIYI’s operation as VIYI does not own fixed assets substantially. Amortization is mainly VIYI’s amortization of intangibles and right of use assets and is projected based on the future amortization amount.

Intelligent chips segment: Projected EBITDA is projected based on gross profit minus operating expenses and adds back depreciation and amortization expenses. Depreciation expenses are not material for this segment’s operation. Amortization is mainly Fe-da’s amortization of intangibles and is projected based on the future amortization amount.

CPA segment: Projected net profit is projected based on gross profits minus operating expenses, other income/ expenses and projected income taxes. VIYI does not have other material income or expenses and the projection is based on historical results. Income tax is projected based on the actual rate of the historical VIE and each subsidiary that operates in CPA segment.

Intelligent chips segment: Projected net profit is projected based on gross profits minus operating expenses, other income/ expenses and projected income taxes. VIYI does not have other material income or expenses and the projection is based on historical results. Income tax is projected based on each subsidiary’s actual tax rate.

Operating history: Although VIYI was incorporated on September 24, 2020, the VIE Shenzhen Yitian was established on March 8, 2011, its PRC subsidiary Korgas 233 Technology Co., Ltd was established on September 15, 2017, and the acquired subsidiary — Fe-da Electronics was established on January 9, 2009 which provide sufficient operating history for the projection. VIYI has a relatively short history for software development which was provided to customers as a value-added service and does not account for a major part of VIYI’s projection.

The key reasons for the projections provided by VIYI’s management team to Venus for the rapid revenue growth as a result of industry growth are summarized below:

The markets VIYI operates its business are expected to maintain a rapid growth

VIYI provides central processing algorithm solutions primarily to the internet advertisement, gaming, and intelligent chip industry, these three markets are expected to maintain a rapid growth, which will provide huge development space for VIYI business.

According to the CIC Report, the digital marketing industry has grown from RMB 218.5 billion in 2015 to RMB 665.8 billion in 2019 in terms of internet advertisement spending, representing a CAGR of 27.5%, and is expected to continue to grow at a CAGR of 8.4%, reaching RMB 1,545.5 billion by 2024, according to the CIC Report. In addition, VIYI understands its customers are increasingly focusing on measurable advertising results, with performance-based advertising solutions experiencing rapid growth. VIYI’s scalable central processing algorithm solutions are well suited to meet this increasing demand and customers’ need for measurable results, i.e., measurable conversion rate.

In terms of the gaming industry, the CIC Report indicates that the overall Chinese gaming market has been continuously growing in the past five years. The market size in terms of consumer spending was RMB 275.5 billion in 2019, representing a year-on-year growth rate of 6.3% since 2018. Notably, mobile games have moved into a leading position in consumer spending and market share in relation to the overall games industry. In 2019, the market for mobile games was ranked number 1 by a proportion of 73.9% and has surpassed traditional PC and web games to become gamers’ dominant choice in the market. The number of mobile gamers in China also increased from 455 million in 2015, to 620 million in 2019, representing a CAGR of 8.0%. according to the CIC Report. VIYI’s game distribution platform coupled with the capability to provide central processing algorithm solutions to upstream developers and gamers alike is uniquely positioned to capture this growing market opportunity.

With the diversified development of the internet industry, there will be increasing needs for application scenarios of central processing algorithms. The central processing algorithm services will be applied in various industries, including advertising, games, finance, industrial internet, telecommunications, energy, logistics, urban management, biomedical, social security and leisure and entertainment.

According to the CIC Report, industry verticals such as government, finance, healthcare, manufacturing, education, and cultural media demand better data processing and management capabilities from an internet advertisement perspective. VIYI believes that its highly versatile central processing algorithm solutions will be ideally suited to meet those demands.

The continuous upgrade of cloud computing, artificial intelligence, big data, 5G and other technological fields also promotes the continuous improvement and update of central processing algorithms. With the rapid development of the internet industry, the ecological development of data, computing power and algorithm is gradually becoming mature and continuously evolving, and many of these factors will jointly promote the speedy development of the central processing algorithm service industry.

VIYI intends to branch out in accordance with market trends and continue to expand its integrated services built upon VIYI’s proprietary central processing algorithms to penetrate industries including: Government; cloud computing; Manufacturing industry; Financial technology; Medical cloud computing; and Smart transportation.

VIYI is ideally positioned to grow its revenue quickly as a leading central processing algorithm service provider in China

According to the CIC Report, VIYI ranks as one of the top five Chinese companies for central processing algorithm services, as of 2020, VIYI has captured 5% of the market share for central processing algorithm services provided to internet advertisement and online gaming industries, and VIYI is the only company among its competitors to provide central processing algorithm service solutions in both internet advertisement and online game industries.

Since 2017, VIYI’s revenue growth has been increasing on a cumulative basis, specifically, VIYI has achieved a year-on-year revenue growth rate of 52.6% in 2019, 176.8% in 2020 and 72.0% in 2021.

Moreover, VIYI’s revenue for the year ended December 31, 2021 was approximately RMB 529.3 million (USD 83.0 million), which represents an increase of RMB 221.5 million, or 72.0%, from VIYI’s total revenues of RMB 307.8 million for the year ended December 31, 2020. VIYI’s gross profit for the year ended December 31, 2021 was RMB 213.7 million (USD 33.5 million), representing an increase of RMB 88.5 million, or 70.7%, from RMB 125.2 million for the year ended December 31, 2020. VIYI’s net income for the year ended December 31, 2021 was RMB 54.7 million (USD 8.6 million), representing an decrease of RMB 36.8 million, or 40.2%, from RMB 91.5 million for the year ended December 31, 2020.

VIYI maintain a good relationship with customers to ensure steady growth of its business revenue

For the years ended December 31, 2020 and 2021. VIYI and its subsidiaries had 157 and 196 customers in the central processing algorithm solution services segment, respectively, of which 57, and 66 are new customers.

Since September 2020, VIYI also began developing its intelligent chips and services business, and has accumulated 12 and 52 customers for the periods ended December 31, 2020, and 2021, respectively

And the Customer retention rate for central processing algorithm solutions services were 80.6% and 82.8% respectively for the years ended December 31, 2020 and 2021, whereas retention rate for intelligent chips and services was 100% for the periods ended December 31, 2020, and 2021.

The following is a general discussion of the material U.S. federal income tax consequences of the Business Combination to U.S. Holders (as defined below) of VIYI ordinary shares; (ii) ownership and disposition of New Venus ordinary shares and New Venus Warrants (collectively, the “New Venus securities”) following the Business Combination and (iii) exercise of redemption rights by New Venus shareholders that are U.S. Holders.

This discussion is based on provisions of the Code, the Treasury Regulations promulgated thereunder (whether final, temporary, or proposed), administrative rulings of the IRS, and judicial decisions, all as in effect on the date hereof, and all of which are subject to differing interpretations or change, possibly with retroactive effect. This discussion does not purport to be a complete analysis or listing of all potential U.S. federal income tax considerations that may apply to a holder as a result of the ownership and disposition of New Venus securities. In addition, this discussion does not address all aspects of U.S. federal income taxation that may be relevant to particular holders nor does it take into account the individual facts and circumstances of any particular holder that may affect the U.S. federal income tax consequences to such holder, and accordingly, is not intended to be, and should not be construed as, tax advice. This discussion does not address the U.S. federal 3.8% Medicare tax imposed on certain net investment income or any aspects of U.S. federal taxation other than those pertaining to the income tax, nor does it address any tax consequences arising under any U.S. state and local, or non-U.S. tax laws. Holders should consult their own tax advisors regarding such tax consequences in light of their particular circumstances.

No ruling has been requested or will be obtained from the IRS regarding the U.S. federal income tax consequences of the Business Combination or any other related matter; thus, there can be no assurance that the IRS will not challenge the U.S. federal income tax treatment described below or that, if challenged, such treatment will be sustained by a court.

This summary is limited to considerations relevant to U.S. Holders that hold VIYI ordinary shares, or New Venus securities, as applicable, as “capital assets” within the meaning of section 1221 of the Code (generally, property held for investment). This discussion does not address all aspects of U.S. federal income taxation that may be important to holders in light of their individual circumstances, including holders subject to special treatment under the U.S. tax laws, such as, for example:

As used in this proxy statement, the term “U.S. Holder” means a beneficial owner of VIYI ordinary shares, or New Venus securities, as applicable, that is, for U.S. federal income tax purposes:

If a partnership, including for this purpose any entity or arrangement that is treated as a partnership for U.S. federal income tax purposes, holds VIYI ordinary shares, or New Venus securities, as applicable, the U.S. federal income tax treatment of a partner in such partnership will generally depend on the status of the partner and the activities of the partnership. A holder that is a partnership and the partners in such partnership should consult their own tax advisors with regard to the U.S. federal income tax consequences of the merger, or of the subsequent ownership and disposition of New Venus securities, as applicable.

THIS SUMMARY DOES NOT PURPORT TO BE A COMPREHENSIVE ANALYSIS OR DESCRIPTION OF ALL POTENTIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER TO U.S. HOLDERS OF VIYI ORDINARY SHARES, OR HOLDING THE NEW VENUS SECURITIES, AS APPLICABLE. U.S. HOLDERS OF VIYI SHARES AND NEW VENUS STOCK HOLDERS SHOULD CONSULT WITH THEIR TAX ADVISORS REGARDING THE PARTICULAR TAX CONSEQUENCES TO THEM OF THE MERGER, AND THE OWNERSHIP AND DISPOSITION OF NEW VENUS SECURITIES, AS APPLICABLE, INCLUDING THE APPLICABILITY AND EFFECTS OF U.S. FEDERAL, STATE, LOCAL, AND OTHER TAX LAWS.

The parties have structured the merger to be treated as a “reorganization” for U.S. federal income tax purposes within the meaning of Section 368(a) of the Code, and the parties to the Business Combination Agreement have agreed to report the merger in a manner consistent with such tax treatment to the extent permitted under applicable law. Neither Venus nor VIYI has requested, and neither intends to request, any ruling from the IRS as to the U.S. federal income tax consequences of the merger. Furthermore, the obligations of VIYI and Venus to complete the merger are not conditioned on the receipt of opinions from counsel to the effect that the merger will qualify as a reorganization for U.S. federal income tax purposes. Consequently, no assurance can be given that the IRS will not assert, or that a court would not sustain, a position contrary to any of those set forth below. Accordingly, each U.S. Holders are urged to consult its tax advisor with respect to the particular tax consequence of the merger to it.

Assuming the merger is treated as a reorganization within the meaning of Section 368(a) of the Code, a U.S. Holder that exchanges its VIYI stock for New Venus ordinary shares in the merger generally will not recognize gain or loss in the transaction.

The aggregate tax basis in the New Venus ordinary shares that a U.S. Holder receives pursuant to the merger will equal its aggregate adjusted tax basis in the VIYI stock it surrenders. A U.S. Holder’s holding period for the New Venus ordinary shares that it receives pursuant to the merger will include the U.S. Holder’s holding period for the VIYI shares it surrenders.

If the merger does not qualify as a reorganization, each U.S. Holder will recognize gain or loss in an amount equal to the difference between (x) the fair market value of the New Venus ordinary shares received and (y) the adjusted tax basis in the VIYI shares surrendered. Gain or loss will be calculated separately for each block of VIYI ordinary shares (generally shares acquired at the same cost in a single transaction) surrendered. Such gain or loss

generally will be capital gain or loss, and will be long-term capital gain or loss if a U.S. Holder has held its VIYI stock for more than one year at the time of the merger. Long-term capital gains of non-corporate U.S. Holders may be eligible for reduced rates of taxation. The deductibility of capital losses is subject to limitations. A U.S. Holder generally will have an aggregate tax basis in the New Venus shares received equal to the fair market value of such shares as of the date such shares are received, and the U.S. Holder’s holding period in such New Venus shares would begin on the day following the date of the merger.

Certain information reporting requirements may apply to each U.S. Holder that is a “significant holder” of VIYI ordinary shares. A “significant holder” is a holder of VIYI ordinary shares that, immediately before the merger, owned at least 1% (by vote or value) of the outstanding VIYI ordinary shares (or, in certain instances, VIYI ordinary shares with a basis of at least $1 million). U.S. Holders are urged to consult their tax advisors as to the potential application of these information reporting requirements.

All holders of VIYI stock are urged to consult their tax advisors with respect to the tax consequences of the merger in their particular circumstances, including tax return reporting requirements, the applicability and effect of the alternative minimum tax, any federal tax laws other than those pertaining to income tax (including estate and gift tax laws), and any state, local, foreign or other tax laws.

U.S. Federal Income Tax Consequences of Ownership and Disposition of New Venus Securities

The following discussion is a summary of certain material U.S. federal income tax consequences of the ownership and disposition of New Venus securities to U.S. Holders.

Subject to the PFIC rules discussed below “— Passive Foreign Investment Company Status,” the gross amount of any distribution on New Venus ordinary shares that is made out of New Venus’ current and accumulated profits (as determined for U.S. federal income tax purposes) will generally be taxable to a U.S. Holder as ordinary dividend income on the date such distribution is actually or constructively received by such U.S. Holder. Any such dividends paid to corporate U.S. Holders generally will not qualify for the dividends-received deduction that may otherwise be allowed under the Code.

Dividends received by non-corporate U.S. Holders, including individuals, from a “qualified foreign corporation” may be eligible for reduced rates of taxation, provided that certain holding period requirements and other conditions are satisfied. For these purposes, a non-U.S. corporation will be treated as a qualified foreign corporation with respect to dividends paid by that corporation on shares that are readily tradable on an established securities market in the United States. U.S. Treasury Department guidance indicates that shares listed on the NASDAQ (on which New Venus lists the New Venus ordinary shares) will be considered readily tradable on an established securities market in the United States. Even though the New Venus ordinary shares are listed on NASDAQ, there can be no assurance that the New Venus ordinary shares will be considered readily tradable on an established securities market in future years. Non-corporate U.S. Holders that do not meet a minimum holding period requirement or that elect to treat the dividend income as “investment income” pursuant to Section 163(d)(4) of the Code (dealing with the deduction for investment interest expense) will not be eligible for the reduced rates of taxation regardless of New Venus’ status as a qualified foreign corporation. In addition, the rate reduction will not apply to dividends if the recipient of a dividend is obligated to make related payments with respect to positions in substantially similar or related property. This disallowance applies even if the minimum holding period has been met. Finally, New Venus will not constitute a qualified foreign corporation for purposes of these rules if it is a PFIC for the taxable year in which it pays a dividend or for the preceding taxable year. See the discussion below under “— Passive Foreign Investment Company Status.”

The amount of any dividend paid in foreign currency will be the U.S. dollar value of the foreign currency distributed by New Venus, calculated by reference to the exchange rate in effect on the date the dividend is includible in the U.S. Holder’s income, regardless of whether the payment is in fact converted into U.S. dollars on the date of receipt. Generally, a U.S. Holder should not recognize any foreign currency gain or loss if the foreign currency is converted into U.S. dollars on the date the payment is received. However, any gain or loss resulting from currency exchange fluctuations during the period from the date the U.S. Holder includes the dividend payment in income to

the date such U.S. Holder actually converts the payment into U.S. dollars will be treated as ordinary income or loss. That currency exchange income or loss (if any) generally will be income or loss from U.S. sources for foreign tax credit limitation purposes.

To the extent that the amount of any distribution made by New Venus on the New Venus ordinary shares exceeds New Venus’ current and accumulated earnings and profits for a taxable year (as determined under U.S. federal income tax principles), the distribution will first be treated as a tax-free return of capital, causing a reduction in the adjusted basis of the U.S. Holder’s New Venus ordinary shares, and to the extent the amount of the distribution exceeds the U.S. Holder’s tax basis, the excess will be taxed as capital gain recognized on a sale or exchange as described below under “— Sale, Exchange, Redemption or Other Taxable Disposition of New Venus Securities.” However, New Venus may not calculate earnings and profits in accordance with U.S. federal income tax principles. In such event, a U.S. Holder should expect to generally treat distributions New Venus makes as dividends.

Sale, Exchange, Redemption or Other Taxable Disposition of New Venus Securities

Subject to the discussion below under “— Passive Foreign Investment Company Status,” a U.S. Holder will generally recognize gain or loss on any sale, exchange, redemption, or other taxable disposition of New Venus ordinary shares and New Venus Warrants in an amount equal to the difference between the amount realized on the disposition and such U.S. Holder’s adjusted tax basis in such New Venus ordinary shares or New Venus Warrants. Any gain or loss recognized by a U.S. Holder on a taxable disposition of New Venus ordinary shares or New Venus Warrants will generally be capital gain or loss and will be long-term capital gain or loss if the holder’s holding period in the New Venus ordinary shares or New Venus Warrants exceeds one year at the time of the disposition. Preferential tax rates may apply to long-term capital gains of non-corporate U.S. Holders (including individuals). The deductibility of capital losses is subject to limitations. Any gain or loss recognized by a U.S. Holder on the sale or exchange of New Venus ordinary shares or New Venus Warrants will generally be treated as U.S. source gain or loss.

No new Venus warrants or options will be used in connection with the Business combination. In connection with its IPO complete in February 2021, Venus issued warrants to acquire ordinary shares. These IPO related warrants will remain outstanding, except to the extent exercised pursuant to their terms by the holders. This discussion below refers to these warrants as New Venus Warrant. Except as discussed below with respect to the cashless exercise of a New Venus Warrant, a U.S. Holder generally will not recognize gain or loss upon the acquisition of a New Venus ordinary share on the exercise of a New Venus Warrant for cash. A U.S. Holder’s tax basis in a New Venus ordinary share received upon exercise of the New Venus Warrant generally will be an amount equal to the sum of the U.S. Holder’s tax basis in the New Venus Warrant exchanged therefor and the exercise price. The U.S. Holder’s holding period for a New Venus ordinary share received upon exercise of the New Venus Warrant will begin on the date following the date of exercise (or possibly the date of exercise) of the New Venus Warrants and will not include the period during which the U.S. Holder held the New Venus Warrants. If a New Venus Warrant is allowed to lapse unexercised, a U.S. Holder generally will recognize a capital loss equal to such holder’s tax basis in the New Venus Warrant.

The tax consequences of a cashless exercise of a warrant are not clear under current tax law. A cashless exercise may be tax-free, either because the exercise is not a gain realization event or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either tax-free situation, a U.S. Holder’s basis in the New Venus ordinary shares received would equal the holder’s basis in the New Venus Warrant. If the cashless exercise were treated as not being a gain recognition event, a U.S. Holder’s holding period in the New Venus ordinary shares would be treated as commencing on the date following the date of exercise (or possibly the date of exercise) of the New Venus Warrant. If the cashless exercise were treated as a recapitalization, the holding period of the New Venus ordinary share would include the holding period of the New Venus Warrant.

It is also possible that a cashless exercise could be treated in part as a taxable exchange in which gain or loss would be recognized. In such event, a U.S. Holder would recognize gain or loss with respect to the portion of the exercised New Venus Warrants treated as surrendered to pay the exercise price of the New Venus Warrants (the “surrendered warrants”). The U.S. Holder would recognize capital gain or loss with respect to the surrendered warrants in an amount generally equal to the difference between (i) the fair market value of the New Venus ordinary shares that would have been received with respect to the surrendered warrants in a regular exercise of the New Venus Warrants and (ii) the sum of the U.S. Holder’s tax basis in the surrendered warrants and the aggregate cash exercise

price of such warrants (if they had been exercised in a regular exercise). In this case, a U.S. Holder’s tax basis in the New Venus ordinary shares received would equal the U.S. Holder’s tax basis in the New Venus Warrants exercised plus (or minus) the gain (or loss) recognized with respect to the surrendered warrants. A U.S. Holder’s holding period for the New Venus ordinary shares would commence on the date following the date of exercise (or possibly the date of exercise) of the New Venus Warrant.

Due to the absence of authority on the U.S. federal income tax treatment of a cashless exercise, there can be no assurance which, if any, of the alternative tax consequences and holding periods described above would be adopted by the IRS or a court of law. Accordingly, U.S. Holders should consult their tax advisors regarding the tax consequences of a cashless exercise.

Certain U.S. Federal Income Tax Consequences of Exercising Redemption Rights

In the event that a U.S. Holder elects to redeem its New Venus ordinary shares for cash, the treatment of the transaction for U.S. federal income tax purposes will depend on whether the redemption qualifies as sale or exchange of the New Venus ordinary shares under Section 302 of the Code. If the redemption qualifies as a sale or exchange of the New Venus ordinary shares, the U.S. Holder will be treated as recognizing capital gain or loss equal to the difference between the amount realized on the redemption and such U.S. Holder’s adjusted tax basis in the New Venus ordinary shares surrendered in such redemption transaction. Any such capital gain or loss generally will be long-term capital gain or loss if the U.S. Holder’s holding period for the New Venus ordinary shares redeemed exceeds one year. Long-term capital gains recognized by non-corporate U.S. Holders will be eligible to be taxed at reduced rates. The deductibility of capital losses is subject to limitations.

If the redemption does not qualify as a sale or exchange of New Venus ordinary shares, the U.S. Holder will be treated as receiving a corporate distribution. Such distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from New Venus’ current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of current and accumulated earnings and profits will constitute a return of capital that will be applied against and reduce (but not below zero) the U.S. Holder’s adjusted tax basis in the New Venus ordinary shares. Any remaining excess will be treated as gain realized on the sale or other disposition of the ordinary shares. Dividends paid to a U.S. Holder that is a taxable corporation generally will qualify for the dividends received deduction if the requisite holding period is satisfied. With certain exceptions (including, but not limited to, dividends treated as investment income for purposes of investment interest deduction limitations) and provided certain holding period requirements are met, dividends paid to a non-corporate U.S. Holder generally will constitute “qualified dividends” that will be subject to tax at the maximum tax rate accorded to long-term capital gains. However, it is unclear whether the redemption rights with respect to the New Venus ordinary shares may prevent a U.S. Holder from satisfying the applicable holding period requirements with respect to the dividends received deduction or the preferential tax rate on qualified dividend income, as the case may be.

Whether a redemption qualifies for sale or exchange treatment will depend largely on the total number of shares of New Venus ordinary shares treated as held by the U.S. Holder (including any New Venus ordinary shares constructively owned by the U.S. Holder as a result of owning New Venus Warrants or New Venus Rights) relative to all of the shares of New Venus ordinary shares outstanding both before and after the redemption. The redemption of New Venus ordinary shares generally will be treated as a sale or exchange of the New Venus ordinary shares (rather than as a corporate distribution) if the redemption (i) is “substantially disproportionate” with respect to the U.S. Holder, (ii) results in a “complete termination” of the U.S. Holder’s interest in New Venus or (iii) is “not essentially equivalent to a dividend” with respect to the U.S. Holder. These tests are explained more fully below.

In determining whether any of the foregoing tests are satisfied, a U.S. Holder takes into account not only New Venus ordinary shares actually owned by the U.S. Holder, but also shares of New Venus ordinary shares that are constructively owned by it. A U.S. Holder may constructively own, in addition to stock owned directly, stock owned by certain related individuals and entities in which the U.S. Holder has an interest or that have an interest in such U.S. Holder, as well as any stock the U.S. Holder has a right to acquire by exercise of an option, which would generally include New Venus ordinary shares which could be acquired pursuant to the exercise of the New Venus Warrants or New Venus Rights. In order to meet the substantially disproportionate test, the percentage of New Venus’ outstanding voting stock actually and constructively owned by the U.S. Holder immediately following the redemption of the New Venus ordinary shares must, among other requirements, be less than 80% of the percentage

of New Venus’ outstanding voting stock actually and constructively owned by the U.S. Holder immediately before the redemption. There will be a complete termination of a U.S. Holder’s interest if either (i) all of the shares of the New Venus ordinary shares actually and constructively owned by the U.S. Holder are redeemed or (ii) all of the shares of the New Venus ordinary shares actually owned by the U.S. Holder are redeemed and the U.S. Holder is eligible to waive, and effectively waives in accordance with specific rules, the attribution of stock owned by certain family members and the U.S. Holder does not constructively own any other New Venus ordinary shares. The redemption of the New Venus ordinary shares will not be essentially equivalent to a dividend if a U.S. Holder’s conversion results in a “meaningful reduction” of the U.S. Holder’s proportionate interest in New Venus. Whether the redemption will result in a meaningful reduction in a U.S. Holder’s proportionate interest in New Venus will depend on the particular facts and circumstances. However, the IRS has indicated in a published ruling that even a small reduction in the proportionate interest of a small minority shareholder in a publicly held corporation who exercises no control over corporate affairs may constitute such a “meaningful reduction.” A U.S. Holder should consult with its own tax advisors as to the tax consequences of a redemption.

If none of the foregoing tests is satisfied, then the redemption will be treated as a corporate distribution. After the application of those rules regarding corporate distributions, any remaining tax basis of the U.S. Holder in the redeemed ordinary shares will be added to the U.S. Holder’s adjusted tax basis in its remaining New Venus ordinary shares, or, if it has none, to the U.S. Holder’s adjusted tax basis in its New Venus Warrants or possibly in other New Venus ordinary shares constructively owned by it.

Certain adverse U.S. federal income tax consequences could apply to a U.S. holder if New Venus, or any of its subsidiaries, is treated as a PFIC for any taxable year during which the U.S. holder holds New Venus securities. A non-U.S. corporation will be classified as a PFIC for any taxable year (a) if at least 75% of its gross income consists of passive income, such as dividends, interest, rents and royalties (except for rents and royalties earned in the active conduct of a trade or business), and gains on the disposition of property that produces such income, or (b) if at least 50% of the average value of its assets (determined on the basis of a quarterly average) is attributable to assets that produce, or are held for the production of, passive income (including for this purpose its pro rata share of the gross income and assets of any entity in which it is considered to own at least 25% of the interest, by value).

Whether New Venus or any of its subsidiaries is treated as a PFIC for U.S. federal income tax purposes is a factual determination that must be made annually at the close of each taxable year and, thus, is subject to significant uncertainty. Among other factors, fluctuations in the market price of New Venus ordinary shares how quickly New Venus uses liquid assets and cash may influence whether New Venus or any of its subsidiaries is treated as PFIC. Accordingly, New Venus is unable to determine whether New Venus or any of its subsidiaries will be treated as a PFIC for the taxable year of the Business Combination or for future taxable years, and there can be no assurance that New Venus or any of its subsidiaries will not be treated as a PFIC for any taxable year. Moreover, New Venus does not expect to provide a PFIC annual information statement for 2021 or going forward.

If New Venus were characterized as a PFIC for any taxable year, U.S. Holders of New Venus securities would suffer adverse tax consequences. These consequences may include having gains realized on the disposition of New Venus securities treated as ordinary income rather than capital gains, and being subject to punitive interest charges on certain dividends and on the proceeds of the sale or other disposition of the New Venus securities. U.S. Holders would also be subject to annual information reporting requirements. In addition, if New Venus were a PFIC in a taxable year in which New Venus paid a dividend or the prior taxable year, such dividends would not be eligible to be taxed at the reduced rates applicable to qualified dividend income (as discussed above). Certain elections (including a mark-to-market election) may be available to U.S. Holders to mitigate some of the adverse tax consequences resulting from PFIC treatment. U.S. Holders should consult their own tax advisors regarding the application of the PFIC rules to their ownership of the New Venus securities.

In general, information reporting requirements will apply to dividends received by U.S. Holders of New Venus ordinary shares (including constructive dividends), and the proceeds received on the disposition of New Venus ordinary shares and New Venus Warrants effected within the United States (and, in certain cases, outside the United States), in each case, other than U.S. Holders that are exempt recipients (such as corporations). Backup

withholding (currently at a rate of 24%) may apply to such amounts if the U.S. Holder fails to provide an accurate taxpayer identification number (generally on an IRS Form W-9 provided to the paying agent or the U.S. Holder’s broker) or is otherwise subject to backup withholding.

Certain U.S. Holders holding specified foreign financial assets with an aggregate value in excess of the applicable dollar threshold are required to report information to the IRS relating to New Venus securities, subject to certain exceptions (including an exception for New Venus securities held in accounts maintained by U.S. financial institutions), by attaching a complete IRS Form 8938, Statement of Specified Foreign Financial Assets, with their tax return, for each year in which they hold New Venus securities. In addition to these requirements, U.S. Holders may be required to annually file FinCEN Report 114 (Report of Foreign Bank and Financial Accounts) with the U.S. Department of Treasury. U.S. Holders should consult their own tax advisors regarding information reporting requirements relating to their ownership of New Venus securities.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be allowed as a refund or credit against a holder’s U.S. federal income tax liability, if any, provided the required information is timely furnished to the IRS.

Potential Conflicts of Interest and Interests of Venus’ Sponsor, Officers and Directors with Respect to the Business Combination

When you consider whether or not to vote for or against the Business combination with VIYI, and you consider the recommendation of the Venus Board in favor of the Business Combination Proposal, the Board of Directors believes that you should consider that the Sponsor and the members of the Board of Directors and management have interests in the proposed Business Combination that are different from, or in addition to, your interests as a shareholder, including those outlined below:

Approval of the Business Combination Proposal will require the affirmative vote of a majority of the votes cast by the holders of the issued Venus ordinary shares entitled to vote thereon which were present at the meeting to approve the Business Combination; provided, however, that if [●] or more of the ordinary shares purchased in the IPO demand redemption of their Venus ordinary shares, then the Business Combination may not be completed.

After careful consideration of the terms and conditions of the Merger Agreement, the Venus board of directors has determined that the Business Combination and the transactions contemplated thereby are fair to and in the best interests of Venus and its shareholders. In reaching its decision with respect to the Business Combination, the Venus board of directors reviewed various industry and financial data and the due diligence and evaluation materials provided by VIYI. The Venus board of directors also obtained a fairness opinion upon which to base its assessment. VENUS’ BOARD OF DIRECTORS RECOMMENDS THAT VENUS’ SHAREHOLDERS VOTE FOR THE BUSINESS COMBINATION PROPOSAL. Venus’ directors have interests that may be different from, or in addition to your interests as a shareholder. See the section titled “The Acquisition Merger Proposal — Interests of Certain Persons in the Acquisition” in this proxy statement for further information.

Venus’ shareholders are being asked to approve the election of five (5) members to the Board of directors of New Venus in accordance with the composition contemplated under the Merger Agreement.

Assuming completion of the Business Combination, shareholders are being asked to elect five directors to the New Venus’ board, effective upon completing the Business Combination. The Director Election Proposal is contingent upon the shareholders’ approval of the Business Combination Proposal.

Pursuant to the terms of the Merger Agreement, the VIYI shareholders are entitled to nominate four (4) persons to serve on the Board of New Venus following the completion of the Business Combination and one (1) additional person will serve as the nominee of Venus. The Venus’ board has nominated Ms. Shan Cui and each of Messrs. Jie Zhao, Min Shu, and Wengang Kang and Ms. Haixia Zhao have been nominated to serve by VIYI as directors of New Venus.

For more information on the experience of Ms. Shan Cui, Ms. Haixia Zhao, and each of Messrs. Jie Zhao, Min Shu, and Wengang Kang, please see the section titled “New Venus’ Directors and Executive Officers After the Business Combination” of this proxy statement.

Under Cayman Islands law, the approval of the Director Election Proposal requires an ordinary resolution, which is the affirmative vote of the holders of a majority of the issued and outstanding shares of Venus, determined as of the record date, present and entitled to vote thereon at the Extraordinary General Meeting voting at the Extraordinary General Meeting.

THE VENUS BOARD UNANIMOUSLY RECOMMENDS THAT VENUS SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE DIRECTOR ELECTION PROPOSAL.

For purposes of complying with Rule 5635(a), (b) and (d) of the Nasdaq Listing Rules, Venus’ shareholders are being asked to approve the issuance of up to 39,603,961 shares of Venus ordinary shares in connection with the Business Combination.

Under Nasdaq Listing Rule 5635(a), shareholder approval is required prior to the issuance of securities in connection with the acquisition of another company if such securities are not issued in a public offering and (i) have, or will have upon issuance, voting power equal to or in excess of 20% of the voting power outstanding before the issuance of common stock (or securities convertible into or exercisable for such securities); or (ii) the number of shares of common stock (or in the case of a Cayman islands entity such as Venus, ordinary shares) to be issued is or will be equal to or in excess of 20% of the number of ordinary shares outstanding before the issuance of the stock or securities. Collectively, the consideration to be paid in connection with the Business Combination Agreement will exceed 20% or more of the outstanding Venus ordinary shares and 20% or more of the voting power, in each case outstanding before the issuance of such ordinary shares in connection with the Business Combination.

Under Nasdaq Listing Rule 5635(b), shareholder approval is required when any issuance or potential issuance will result in a “change of control” of the issuer. Although Nasdaq has not adopted any rule on what constitutes a “change of control” for purposes of Rule 5635(b), Nasdaq has previously indicated that the acquisition of, or right to acquire, by a single investor or affiliated investor group, as little as 20% of the common stock (or securities convertible into or exercisable for common stock) or voting power of an issuer could constitute a change of control. Under Nasdaq Rule 5635(b), the issuance of the ordinary shares in the Business Combination Consideration will result in a “change of control” of Venus. VIYI Shareholders will own or control 39,603,961 New Venus ordinary shares, or approximately 85.84% of the New Venus ordinary shares following the Business Combination.

Under Nasdaq Listing Rule 5635(d), shareholder approval is required for a transaction other than a public offering involving the sale, issuance or potential issuance by an issuer of ordinary shares (or securities convertible into or exercisable for common stock) at a price that is less than the lower of (i) the closing price immediately preceding the signing of the binding agreement or (ii) the average closing price of the ordinary shares for the five trading days immediately preceding the signing of the binding agreement, if the number of ordinary shares (or securities convertible into or exercisable for ordinary shares) to be issued equals 20% or more of the ordinary shares, or 20% or more of the voting power, outstanding before the issuance. Because ordinary shares of New Venus will be issued in exchange for all of the equity interests of VIYI, the deemed issuance price of the shares of New Venus may be less than the lower of (i) the closing price immediately preceding the signing of the Business Combination Agreement or (ii) the average closing price of the Venus ordinary shares for the five trading days immediately preceding the signing of the Business Combination Agreement. If the Business Combination Proposal is approved, the issuance of the shares of New Venus ordinary shares will exceed 20% of the shares of Venus Common Stock currently outstanding. Because the issuance price may be deemed to be below the lower of (i) the closing price immediately preceding the signing of the Business Combination Agreement or (ii) the average closing price of the Venus ordinary shares for the five trading days immediately preceding the signing of the Business Combination Agreement, the Nasdaq Listing Rules may require that Venus obtains shareholder approval of the issuance of the shares of New Venus ordinary shares in connection with the consummation of the Business Combination.

As a result of the foregoing, Venus is required to obtain shareholder approval pursuant to Nasdaq Listing Rule 5635.

The approval of the Nasdaq Stock Issuance Proposal will require the affirmative vote of the holders of a majority of the outstanding Venus ordinary shares present (which would include presence at a virtual meeting) or represented by proxy and entitled to vote at the meeting.

THE BOARD UNANIMOUSLY RECOMMENDS THAT VENUS SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE NASDAQ STOCK ISSUANCE PROPOSAL.

The Venus Board of Directors is requesting that its shareholders approve an amendment to its Memorandum and Articles of Association substantially in the form attached to this proxy statement as Annex A, to be effective upon the consummation of the Business Combination, to increase the number of authorized ordinary share to 200,000,000 ordinary shares from the present authorized capital of 50,000,000 ordinary shares.

Assuming upon completion of the Business Combination and the issuance of New Venus ordinary shares to the VIYI shareholders pursuant to the Merger Agreement and the automatic conversion of the outstanding Venus Rights, Venus would have 41,571,610 ordinary shares issued and outstanding. Additionally, the current Venus warrants would remain issued and outstanding, exercisable into an aggregate of 2,412,500 additional ordinary shares.

As a result, although it does not currently have plans or binding agreements to issue any ordinary shares or have any contemplated transactions such as acquisitions or additional financings which would require the issuance of any additional ordinary shares, the Board of Directors of Venus and the VIYI shareholders believe that New Venus should have additional ordinary shares authorized for future possible events such as acquisitions or financings or for stock dividends or stock splits which may be undertaken in the future.

In the case of the Share Increase Proposal, approval requires an ordinary resolution of the affirmative vote of at least a majority of the votes cast by the holders of the Venus ordinary shares present in person or represented by proxy at the Extraordinary General Meeting and entitled to vote.

THE BOARD OF VENUS UNANIMOUSLY RECOMMENDS THAT VENUS SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE SHARE INCREASE PROPOSAL.

In connection with the Business Combination, we are asking our shareholders to approve the adoption of the proposed amendments to our Memorandum and Articles of Association, substantially in the form attached to this proxy statement as Annex C, to be effective upon the consummation of the Business Combination to change the name of Venus to MicroAlgo Inc.

In consultation with VIYI and its shareholders, the Venus Board of Directors believes that the new name will more accurately reflect the business of VIYI and its intended and future businesses and operations.

As a business formed solely for the purpose of completing a business combination, the current name of Venus has no business meaning or trade value.

In the case of the Name Change Proposal, approval requires a special resolution of the affirmative vote of at least two thirds (2/3) of the votes cast by the holders of the Venus ordinary shares present in person or represented by proxy at the Extraordinary General Meeting and entitled to vote.

THE BOARD OF VENUS UNANIMOUSLY RECOMMENDS THAT VENUS SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE NAME CHANGE PROPOSAL.

This summary is qualified by reference to the complete text of the proposed Memorandum and Articles of Association, substantially in the form attached to this Proxy statement as Annex C. All shareholders are encouraged to read the proposed Memorandum and Articles of Association, in their entirety for a more complete description of their terms.

Our proposed amendments to the Memorandum and Articles of Association does not include provisions related to a blank check company (including those related to operation of the trust account, winding up our operations should we not complete an initial business combination by a specified date, and other such blank check-specific provisions as are present in the existing organizational documents) because following the consummation of the Business Combination, New Venus will not be a blank check company. The proposed organizational documents do not contain the requirement to dissolve New Venus allowing it to continue as a corporate entity with perpetual existence following the Business Combination. Perpetual existence is the usual period of existence for corporations, and our board of directors believes it is the most appropriate period for New Venus following the Business Combination.

The Articles amendment Proposal must be approved by a special resolution as a matter of Cayman Islands law, being the affirmative vote of the holders of at least two-thirds of the ordinary shares as of the record date that are present and vote at the Extraordinary General Meeting. Abstentions and broker non-votes, while considered present for the purposes of establishing a quorum, will not count as a vote cast and will have no effect on the outcome of the vote on Articles Amendment Proposal. Failure to vote by proxy or to vote in person at the Extraordinary General Meeting will have no effect on the outcome of the vote on Articles Amendment Proposal.

THE BOARD OF VENUS RECOMMENDS THAT OUR SHAREHOLDERS VOTE “FOR” THE APPROVAL OF ARTICLES AMENDMENT PROPOSAL.

The adjournment proposal allows the Venus Board of Directors to submit a proposal to adjourn the extraordinary general meeting to a later date or dates, if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Business Combination Proposal, the Nasdaq Stock Issuance Proposal, the Share Increase Proposal, the Name Change Proposal and the Articles Amendment Proposal.

In no event will Venus solicit proxies to adjourn the extraordinary general meeting or consummate the Business Combination beyond the date by which it may properly do so under its current certificate of incorporation and Cayman Islands law. The purpose of the adjournment proposal is to provide more time for the Sponsor, Venus and/or their respective affiliates to make purchases of public shares or other arrangements that would increase the likelihood of obtaining a favorable vote on such proposal and to meet the requirements that are necessary to consummate the Business Combination. See the section entitled “Proposal No. 1 — The Business Combination Proposal — Interests of Certain Persons in the Business Combination.”

In addition to an adjournment of the extraordinary general meeting upon approval of an adjournment proposal, the Venus Board is empowered under Cayman Islands law to postpone the meeting at any time prior to the extraordinary general meeting being called to order. In such event, Venus will issue a press release and take such other steps as it believes are necessary and practical in the circumstances to inform its shareholders of the postponement.

If an adjournment proposal is presented at the extraordinary general meeting and is not approved by the shareholders, the Venus Board may not be able to adjourn the extraordinary general meeting to a later date. In such event, the Business Combination would not be completed.

The approval of the adjournment proposal will require the affirmative vote of a majority of the votes cast by holders of Venus’ outstanding ordinary shares represented at the extraordinary general meeting by attendance in person or by proxy and entitled to vote thereon.

Adoption of the adjournment proposal is not conditioned upon the adoption of any of the other proposals. Accordingly, if a valid quorum is established, a Venus shareholder’s failure to vote by proxy or to vote at the extraordinary general meeting, abstentions and broker non-votes with regard to the adjournment proposal will have no effect on such proposal. Abstentions and broker non-votes will have no effect on the outcome of the adjournment proposal.

THE Venus BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE Venus SHAREHOLDERS VOTE “FOR” THE APPROVAL OF THE ADJOURNMENT PROPOSAL.

VIYI’s mission is to transform the digital economy by making the way its customers do business more efficiently.

VIYI is dedicated to the development and application of bespoke central processing algorithms. VIYI provides comprehensive solutions to customers by integrating central processing algorithms with software or hardware, or both, thereby helping them increase the number of customers, improve end-user satisfaction, achieve direct cost savings, reduce power consumption, and achieve technical goals. The range of VIYI’s services include algorithm optimization, accelerating computing power without the need for hardware upgrades, lightweight data processing, and data intelligence services. VIYI’s ability to efficiently deliver software and hardware optimization to customers through bespoke central processing algorithms serves as a driving force for VIYI’s long-term development.

Central processing algorithms refer to a range of computing algorithms, including analytical algorithms, recommendation algorithms, and acceleration algorithms. According to the CIC Report, businesses engaged in internet advertisement, game development, intelligent chip design, finance, retail, and logistics depend on the ability to efficiently process and analyze data with optimized computing software and hardware capable of handling the data workload. Bespoke central processing algorithms suitable to each customer’s distinct needs help them achieve this purpose.

Currently, VIYI is focused on developing and delivering central processing algorithm solutions to customers engaged in internet advertisement and gaming, and intelligent chips. Moreover, VIYI’s customer base is rapidly growing due to the increase in a general demand for more efficient data processing in various industries driven by the growing internet population and prevalence of AI. According to the CIC Report, revenue of central processing algorithm services derived from internet advertisement and online gaming alone has grown from RMB 2.2 billion in 2016 to RMB 6.9 billion in 2020, representing a CAGR of 32.7%. This market is expected to maintain a rapid growth trend, expanding at a CAGR of 15% during the period from 2020 to 2025 in terms of dollar value.

Leading bespoke central processing algorithm service provider in China enjoying first-mover advantages and rapid revenue growth

VIYI ranks as one of the top five Chinese companies for central processing algorithm services. According to the CIC Report, as of 2020, VIYI has captured 5% of the market share for central processing algorithm services provided to internet advertisement and online gaming acceleration industries.

VIYI is ideally positioned to grow its revenue quickly as a leading central processing algorithm service provider in China. According to the CIC Report, VIYI is the only company amongst its competitors to provide central processing algorithm service solutions in both internet advertisement and online game acceleration industries. As a result, since 2017, VIYI’s revenue growth has been increasing on a cumulative basis, specifically, VIYI has achieved a year-on-year revenue growth rate of 31.9% in 2018, 52.6% in 2019, and 176.8% in 2020.

Customized central processing algorithm solutions in a diverse range of scenarios, serving customers in a diverse and growing range of industry verticals

VIYI’s diverse range of customers from multiple industries is evidence that it’s central processing algorithm technology is highly versatile, which allows VIYI to ensure a constant stream of revenue from various sources. VIYI primarily provides central processing algorithm solutions to enterprise customers in three industry verticals: internet advertisement, gaming, and intelligent chips, which translate to a range of customers including advertisement integration agencies, game developers and distributors, electronics manufacturers, internet information infrastructure service providers, and intelligent chip designers and integrators. Having the capability to service customers from a range of industries works to VIYI’s advantage because it can derive business from multiple industry sources to ensure a stream of revenue even when one industry faces downturns.

Generally, the central processing algorithm services of VIYI achieve computing power acceleration, digital lightweight processing, and intelligent data management and processing. These improvements help VIYI’s customers grow and enhance their businesses’ operational quality and overall efficiency. Currently, VIYI’s central processing algorithm solutions have the following applications to its existing core customers:

For more information on how VIYI provides services to its customers, please see “Business — VIYI’s Business Model.”

In addition, due to the versatility of VIYI’s central processing algorithm solutions and VIYI’s proven commitment to research and development, VIYI is well-positioned to continue growing its customer base to reach customers from a broader range of industries that are reforming the way they do business as a result of the rapidly developing information technology, prevalence of smartphones and 5G connectivity, AI, big data, IoT and cloud computing. According to the CIC Report, industry verticals such as government, finance, healthcare, manufacturing, education, and cultural media demand better data processing and management capabilities from an internet advertisement perspective. VIYI believes that its highly versatile central processing algorithm solutions will be ideally suited to meet those demands. For more information on VIYI’s expansion plans, please also see “Business — VIYI’s Strategies — VIYI plan to expand its central processing algorithm solutions to cover more applications and different industries.”

VIYI enjoys stable and long-term strategic alliances with many of its customers in the internet advertisement, gaming, and intelligent chip design and development. VIYI’s customers are internet advertising integration agencies, online game developers and distributors, electronics manufacturers, and internet information infrastructure service providers who have entered into a master agreement with VIYI and used its services according to such agreement during the relevant contact period. VIYI’s customers typically enter into a master agreement with VIYI for a fixed term, which means VIYI is constantly communicating with its customers to help them explore needs or applications which may be optimized. Once that need is identified, VIYI’s customers send in a separate request for service engagements or products, or both. VIYI’s involvement in its customers’ process of identifying needs means they count on VIYI as trusted advisors to introduce them to industry trends and VIYI’s latest technological developments. This close collaboration creates a synergistic effect between VIYI and its customers, which results in high customer loyalty.

Market leader in cutting edge technology protected by intellectual property rights

The CIC Reports indicates that VIYI is the market leader in terms of the quantity of intellectual property. As of December 31, 2021, VIYI owns 515 proprietary intellectual property rights, which include 370 copyrights of which 367 are software copyrights, 81 patents, 25 registered trademarks, 20 exclusive rights for the layout design of integrated circuit, and 19 domain names. The large quantity of intellectual property at VIYI’s disposal as compared to VIYI’s competitors exemplifies VIYI’s commitment to research and development and long-term development. For a comparison of the number of intellectual property at VIYI’s disposal as compared to VIYI’s competitors, please see “Industry Overview — Intellectual Property Rights Ranking in The Field of Central Processing Algorithm Service.”

VIYI leverages its fixation on staying in the forefront of technological development to help customers explore solutions and needs that are yet to be identified. VIYI then provides proprietary central processing algorithm solutions to meet those needs.

To maintain VIYI’s market leader position, VIYI is seizing opportunities arising from the increasing global application of emerging technologies such as cloud computing, AI, and 5G, by focusing on applications stemming from these technologies that are ripe for optimization via central processing algorithms. In the year ended December 31, 2021, VIYI expended RMB 107,035,272 in research and development; VIYI intends to commit more investments in the future to improve upon its research and development platform, retain talented individuals in the field of central processing algorithm technology, and strengthen the research and development for core technologies and products. VIYI’s efforts for research and development have, and will continue to secure VIYI’s market leader position through technical barriers, which has allowed VIYI to stay afront and be the first choice of VIYI’s customers.

Visionary and experienced management team in the central processing algorithm industry and exceptional research and development team

VIYI believes that its success is attributable in part to VIYI’s experienced and visionary senior management team with extensive experience in China’s information technology industry. VIYI’s management team, led by Chengwei Yi, its CEO/CTO and executive director, has delivered proven financial results since the company’s inception. Mr. Yi has accumulated over 18 years of experience in the information technology industry since he began his career as a software development engineer. Since entering the industry, he has also developed leadership and management skills in various management roles prior to joining VIYI in 2011 as a director and general manager of Shenzhen Yitian. Mr. Yi also holds an EMBA degree from the China Europe International Business School. Mr. Yi is supported by VIYI’s senior management team with over 50 years of collective industry experience, including VIYI’s Chairman of the Board, Jie Zhao, Chief Financial Officer, Li He, and Chief Operating Officer, Shiwen Liu.

VIYI’s goal to stay at the forefront of technological development and fixation on research and development has driven VIYI to build an exceptional research and development team staffed by 98 full-time research and development team members. VIYI’s research and development team is well versed in early-stage technological development to implement central processing algorithm solutions in a range of use cases. VIYI’s core technical staff have an average of 5 to 8 years of working experience in computer, software, computer graphic processing, data algorithm and neural networks. VIYI’s talented technical staff are responsible for the design and development of central processing algorithm solutions in, for example, algorithm design and development, digital graphic lightweight processing, image synthesis and data intelligence. For more information on VIYI’s intellectual property, please see “Business — Intellectual Property.”

VIYI’s management principals are best described as efficient and quick, open and innovative, and customer-dedicated:

Driven by VIYI’s management principles, VIYI has kept both its team members and customers happy and satisfied, which has attributed to VIYI’s success to date.

To achieve VIYI’s mission and further grow its market position, VIYI plans to implement the following strategies:

VIYI will continue to strengthen its central processing algorithm solutions for its core customers in internet advertisement, gaming, and intelligent chip businesses to ensure a steady revenue stream.

VIYI’s core customers in internet advertisement, gaming, and intelligent chip businesses represent industries experiencing significant growth in recent years and are expected to continue growing. VIYI will continue to strengthen and market its central processing algorithm solutions applicable to its core industry customers to deliver measurable results and ensure a constant stream of revenue.

The digital marketing industry has grown from RMB 218.5 billion in 2015 to RMB 665.8 billion in 2019 in terms of internet advertisement spending, representing a CAGR of 27.5%, and is expected to continue to grow at a CAGR of 8.4%, reaching RMB 1,545.5 billion by 2024, according to the CIC Report. In addition, VIYI understands its customers are increasingly focusing on measurable advertising results, with performance-based advertising solutions experiencing rapid growth. VIYI’s scalable central processing algorithm solutions are well suited to meet this increasing demand and customers’ need for measurable results, i.e., measurable conversion rate. For details of VIYI’s range of services for internet advertisement customers, please see “Business — VIYI’s Business Model — Application of VIYI’s central processing algorithm service in internet advertisement.”

In terms of the gaming industry, the CIC Report indicates that the overall Chinese gaming market has been continuously growing in the past five years. The market size in terms of consumer spending was RMB 275.5 billion in 2019, representing a year-on-year growth rate of 6.3% since 2018. Notably, mobile games have moved into a leading position in consumer spending and market share in relation to the overall games industry. In 2019, the market for mobile games was ranked number 1 by a proportion of 73.9% and has surpassed traditional PC and web games to become gamers’ dominant choice in the market. The number of mobile gamers in China also increased from 455 million in 2015, to 620 million in 2019, representing a CAGR of 8.0%. Moreover, the average daily time spent by mobile gamers is expected to grow at a CAGR of 7.0%, reaching 30 minutes per day by 2024, according to the CIC Report. VIYI’s game distribution platform coupled with the capability to provide central processing algorithm solutions to upstream developers and gamers alike is uniquely positioned to capture this growing market opportunity. For details of VIYI’s range of services for gaming industry customers, please see “Business — VIYI’s Business Model — Application of VIYI’s central processing algorithm service in internet gaming entertainment industry.”

In terms of the intelligent chip industry, according to the CIC Report, technologies that are critical to the intelligent chip industry have become increasingly mature since the beginning of the 21^st century. Intelligent chips have also been entering into consumers’ daily lives at an increasing rate as components to mobile phones, personal computers, and smart TVs. Since 2017, driven by the demand from emerging industries such as AI, smartphones, IoT, 5G, cloud computing, smart healthcare, and security, the global chip industry has grown from US$274.5 billion in 2015 to US$333.4 billion in 2019. Growth is expected to continue at a CAGR of 7.5% per year, reaching US$515.7 billion by 2025 due to increasing downstream demand. Notably, the AI market has significantly benefitted from the development of IoT, cloud computing technology, and an increase in government investments. From a quantitative perspective, the scale of the core industry is expected to reach RMB 400 billion by 2025, representing an increase of RMB 350 billion from 2020 to 2025. The development of AI will be a significant driving force behind the monetization market for central processing algorithm solutions intended to optimize intelligent chip performance.

From the perspective of applications of VIYI’s central processing algorithms in relation to intelligent chips, VIYI understands that AI — from cloud to edge or down to terminals — is inseparable from the ability for intelligent chips to efficiently execute “training” and “inference” computing tasks, which cannot occur unless the baseline software and hardware are optimized correctly. Moreover, industrial applications of intelligent chips are wide-ranging and include information infrastructure services, electronic products manufacturing, image recognition, voice recognition, machine translation, smart IoT, and other smart applications. These demands create a distinct market for VIYI’s central processing algorithms solutions, while giving off better energy efficiency ratios during such data processing exercises.

VIYI will continue to strengthen its research and development capabilities in central processing algorithms to establish more technical barriers to enhance VIYI’s competitiveness.

Technological innovation coupled with research and development sets the foundation for VIYI to maintain competitiveness. VIYI endeavors to increase investments in research and development to improve upon VIYI’s research and development platform, retain talented individuals in the field of central processing algorithm technology, and strengthen the research and development for core technologies and products, intelligent chips algorithms and AI algorithms. In so doing, VIYI aims to seize first-mover opportunities created by an increasing global application of emerging technologies such as cloud computing, artificial intelligence, and 5G, and focus on the development of central processing algorithm services capable of enhancing the research and development capabilities for these emerging technologies.

Meanwhile, VIYI is continuously working on expanding VIYI’s range of intellectual property, including software copyright and utility model patents. Currently, VIYI has 45 utility model patents also under application, including “overheating detection device of central processing unit” and “fault and power failure device of central processing unit.”

Through research and development, VIYI will continue to improve the applications and platform upon which VIYI provides VIYI’s central processing algorithm service. By taking advantage of cloud computing, VIYI plans on integrating AI chip technology, big data management, analytics, and other emerging technologies to provide a comprehensive service platform that combines both hardware and software to explore all potential value of data by way of data intelligence analysis. VIYI’s ultimate goal is to integrate central processing algorithm technology, big data, and artificial intelligence via the cloud infrastructure and provide even more versatile software and hardware integration service for smart application for industrial purposes, creating an ecosystem where individuals, enterprises and various applications are interconnected, so as to enable VIYI’s customers and other industry participants to accelerate the process of digital transformation in alignment with VIYI’s mission.

VIYI plans to expand its central processing algorithm solutions to cover more applications and increase marketing efforts aimed at different industries.

VIYI plans to expand the range of VIYI’s central processing algorithms’ application for use in mobile internet, finance, government, manufacturing, and other industries where there is an increasing demand for data management and processing efficiency, according to the CIC Report. While focusing on VIYI’s customers in internet advertisement, gaming, and intelligent chips to generate revenue, VIYI intends to branch out in accordance with market trends and continue to expand the application and platform of VIYI’s central processing algorithm solutions consistently with this development strategy. In so doing, VIYI intends to expand VIYI’s integrated services built upon VIYI’s proprietary central processing algorithms to penetrate industries including:

Below is a brief industry overview for each of these industries and VIYI’s value-added:

The government is committed to breaking down data silos and sharing urban resources to provide better civil services and security to the general population, which means the “market” for the government’s services is by far the largest in any industry. In the process of a government’s self-transformation, it would be required to undertake massive data management and analysis, massive data connectivity and massive city terminal perception exercises.

In general, the government cloud is a platform that serves as the “engine room,” coordinating the technological hardware and software resources used by the government. The cloud provides the government with a platform to engage in comprehensive services such as infrastructure, supporting software, application system, information resources, operation guarantee, and information security. By using cloud technology, the government significantly reduces IT costs, promotes the sharing of information between departments, and improves the speed of launching applications and service quality. The government is also able to accelerate the establishment of smart cities and satisfy the high threshold of data sharing by efficiently processing and managing data.

The government cloud algorithm solutions VIYI intends to provide enable the government to improve the efficiency and quality of service of the government cloud platform’s operational efficiency and quality of service, and have exhibited strong market potential.

As information technology is ever-increasing intertwined with traditional manufacturing industries, the industrial internet is constantly required to upgrade ICT infrastructure platform, which is a platform for unified communications, to support the application digitalization, networking, and intelligent upgrading of the manufacturing industry and the entire real economy. The integration of information technology and manufacturing also gave rise to new business models such as network collaboration, personalized customization, and service-oriented manufacturing. A variety of machines, devices, and equipment must be embedded with a large number of energy-efficient chips and connected to the network through sensors, embedded controllers, and application systems to form a new complex architecture based on “terminal-cloud” collaboration.

With the integration of AI, these new business models promote the centralization and intelligent development of the manufacturing industry. As a result of network inter connectivity between machines, raw materials, control systems, information systems, products, and people, efficient business decisions can be made through the combination of comprehensive and in-depth perception of data and big data analysis to achieve intelligent control, operation optimization and production organization reform, effectively unleashing the potential of machines and enhancing productivity. As a transit station for data localization and transmission, central processing algorithms serve a crucial role in the overall development of the industrial internet.

Financial technology is reshaping the way the financial industry work. The transformation of channel and real-time trading scenarios from a centralized system to a fully distributed system demands higher computing power and better energy efficiency ratios. In the next few years, operation analysis scenario will complete the switch from all-in-one to an open architecture, requiring high distributed concurrency. The new smart finance business is the fastest-growing scenario in the future, which requires high concurrency and mobile collaboration. The traditional business scenario is transforming to the cloud, which requires low energy consumption and costs to improve the price-performance ratio of big data comprehensive analysis.

Big data finance focuses on the acquisition, storage, processing analysis, and visualization of financial big data. In general, the core technologies of financial big data include the infrastructure layer, the data storage and management layer, the computing processing layer, the data analysis and visualization layer. The data analysis and visualization layer are mainly responsible for simple data analysis, advanced data analysis, and visualization of the relevant analysis results. Big data finance is also committed to the research and development of new financial business models of financing, payment, investment, and information intermediary services by adopting internet technology and information and communications technology. The application scenarios above would benefit from bespoke centralized processing algorithms to improve business efficiency and reduce costs.

Big data and AI technologies will drive the way consumers access health care. Applications include intelligent healthcare such as disease prediction, personalized precision healthcare, personalized medicine, and medical graph and image analysis. Distinct features of the medical cloud include data diversity (such as voice, text, and medical images) and massive data volume (such as high-quality data training). VIYI’s central processing algorithms solutions can meet the diversified computing needs for green and low power consumption and intensive computing power.

The medical cloud essentially serves as the holder of electronic health records. With the development of the medical cloud, functions such as remote consultation, remote medical treatment, and information sharing are becoming a reality. Moreover, medical cloud will promote public health and achieve cross-system and cross-department business information sharing, allowing medical and health service institutions to share medical resources and carry out remote diagnosis and treatment services to individuals or families to reduce repeated examination expenditures. It will also make patient transfers between hospitals more efficient, and patients can enjoy higher quality services through remote medical treatment and establish an information-sharing platform.

Terminal-edge-cloud is crucial to the future of how people travel. On the terminal side, it is necessary to have a comprehensive view of the surrounding situation and detailed information and to make changes in a timely manner. On the edge side, it is essential to timely provide intelligent and accurate information on decision-making for efficient deployment. On the cloud side, a sustainable and iterative “brain” is needed to empower the edge and terminal sides. Collection of traffic information through efficient technologies enables transportation industry players to engage in more efficient traffic management, public travel, and the industry vertical pertaining to transportation construction management. Through the terminal-edge-cloud, and interconnected transportation system can efficiently perceive, analyze, predict and control regional traffic to ensure safety and efficiency.

To achieve such a level of interconnectivity, terminal-edge cloud servers and data centers perform intensive arithmetic processing for large amounts of raw data, which demands excellent computing capacity, speed, data storage, and bandwidth of basic hardware such as chips. As traditional data centers face various development bottlenecks such as high energy consumption and low computing efficiency, terminal-edge cloud servers will prove to be the answer to the industry’s current problem.

With the continuous popularization of these new technologies, the realization of an intelligent society must first undergo comprehensive digitalization, and the central processing algorithm application field is the core driver of such digitalization.

Based on the 3DPaaS vertical cloud service platform, VIYI provides internet industry applications with support in areas including scenario intelligence, scenario visualization, and lightweight processing for 3D interactive procedures. One of VIYI’s goals is to construct the best intelligent 3D data platform in China to provide more efficient and intelligent information services for people’s work and life.

Through the implementation of hybrid cloud deployment solutions, 3D computing system architecture, and interactive stream transmission, VIYI has solved many industry pain points, such as excessive data usage on 3D Internet online applications and cross-platform deployment. VIYI’s self-developed 3D acceleration algorithm, intelligent interaction, and stream transmission technologies are the first in the PRC and have already achieved commercialization.

VIYI provides enterprises with a one-stop lightweight launching cloud platform for 3D applications, which is featured with scenario-based intelligent interaction. VIYI will charge fees on a project-by-project basis (B2B) or based on various factors such as space usage and traffic volume, annual fees, and technology licensing to cater to different industries such as VR, AR, games, 3D interactive programs, and scenario-based e-commerce. VIYI will facilitate the promotion and application of central processing algorithm technology in the future.

Leveraging VIYI’s technologies on 3D online display, VR tours, data algorithm analysis, and precise traffic algorithm matching, VIYI will provide enterprise owners with a one-stop product display system, real-time VR product tour and interactive communication, VR live professional broadcast promotion, and sales platform, decision-making system for customer acquisition and data optimization, and consumer analysis and accurate user matching algorithm system.

This technology provides a new form of display and interactive communication for products and integrates the functions, features, and highlights of product introduction. Through intuitive interaction, customers can quickly switch and select different materials and colors of the same product.

Leveraging the current development of the central processing algorithm technology and VIYI’s technical reserve capability, the platform is ready for use under the existing environment. VIYI will receive relevant service fees from content production, annual fees for the SAAS system, algorithm technology service fees, and streaming platform licensing fees. VIYI is currently liaising with some small and medium-sized brand owners in relation to the provision of VIYI’s competitive product (SAAS) marketing cloud services. VIYI’s next step is to provide global online product (SAAS) marketing cloud services both domestically and internationally to export companies and factories.

VIYI will selectively seek strategic acquisitions to enhance market position, integrate industrial chain resources, and maximize capital efficiency.

VIYI intends to pursue investment opportunities or acquire businesses that complement or enhance VIYI’s existing businesses that are strategically beneficial to VIYI’s long-term goals. VIYI aims to target companies that have competitive strengths in algorithm development and research, and AI capabilities to enhance VIYI’s research and development abilities.

In addition, VIYI plans to pursue business collaborations to enhance VIYI’s operational efficiency by collaborating with resource-based partners that generate significant user traffic. VIYI’s ideal partners are internet traffic wholesalers, game developers, and advertisement integration agencies.

VIYI will continue its focus on brand building to enhance VIYI’s brand value.

Concurrent to improving VIYI’s innovative technologies, VIYI is attaching ever greater importance to brand building and strategic positioning, especially in view of becoming a public company. VIYI carries out brand value communication through multiple channels, including through media and investor relations. VIYI believes that building a good reputation in the industry is essential to building up brand value. VIYI strives to maximize brand value by providing customers with high-quality products and services, operates VIYI’s business with integrity, and builds an excellent corporate image through good value output.

VIYI provides central processing algorithm solutions primarily to the internet advertisement, gaming, and intelligent chip industry. VIYI’s customers are internet advertising integration agencies, online game developers and distributors, electronics manufacturers, and internet information infrastructure service providers who have

entered into contracts with VIYI and used its services pursuant to such contracts during the relevant period. Customers typically enter into a master agreement with VIYI for a fixed term and submit separate requests for each service engagement or product, or for both. For more information on how VIYI enters into business arrangements with VIYI’s customers, please see “Business — VIYI’s Strengths — Long-term and stable strategic cooperation relationships.”

Application of VIYI’s central processing algorithm service in internet advertisement

Generally, [for customers in the field of internet advertisement, like internet advertising integration agencies, VIYI’s central processing algorithm solutions helps them engage in more efficient data processing and management, which culminates in more effective programmed advertising and dynamic content optimization with the goal to improve consumer conversion rate, which means the rate at which individuals who have seen an advertisement turn into a user or purchaser of the service or items contemplated by the advertisement.

VIYI’s proprietary central processing algorithm solutions improve upon the processes by which VIYI’s customers are able to make one of their most crucial business decisions — the effective placement of advertisements. In sum, VIYI’s customers provide advertisement materials in the form of 3D models or images, which VIYI processes in its back servers into more detailed data such as color key and fusion image; VIYI then purchases advertisement placement opportunities from ad traffic wholesalers and begins analyzing multimedia sources hosted on such traffic wholesalers with VIYI’s image recognition software to extract scenario data from such videos to determine data points such as the location, time, space and other useful information. At the same time, VIYI is also processing internet users’ data to achieve effective and precise placement of advertisements.

The diagram below illustrates the key steps of providing solutions to VIYI’s digital marketing customers:

VIYI first obtains advertisement placement opportunities from internet traffic wholesalers. VIYI then uses its image recognition software to perform scenario-based classification of such videos to determine their location, time, space, and other relevant information to identify the most appropriate places to insert VIYI’s customers’ advertisements. With such data, VIYI establishes dynamic information databases in relation to these multimedia sources with technology such as Relational Database Service (RDS) to be further processed at VIYI’s disposal. At the same time, VIYI’s back servers are communicating with these traffic wholesaler’s servers to collect user

data, which VIYI then processes with its crowd-based socio-cognitive systems (SCS) for the purpose of effectively placing VIYI’s customer’s advertisement through a process of dynamic content optimization (DCO), with the aim of improving VIYI’s customers’ consumer conversion rate.

In sum, VIYI provides effective advertising solutions for digital marketers by optimizing advertising content and precisely matching content with suitable consumers by processing a massive amount of data through efficient automation. Eligible consumers are selected in accordance with their demographics and personal preferences, which VIYI’s central processing algorithm service is able to analyze for the purpose of maximizing the internet advertisement effect.

VIYI ensures high-quality engineering architecture for VIYI’s proprietary central processing algorithms, which means VIYI’s services are being provided at low latencies while being highly scalable. VIYI is capable of powerful real-time transcoding with stable, smooth, and low latency, which provides VIYI’s customers valuable insights into consumer behavior.

Application of VIYI’s central processing algorithm service in the internet gaming entertainment industry

With respect to customers in the gaming and entertainment industry, VIYI provides game developers with lightweight data processing solutions through customized central processing algorithms. VIYI also maintains a proprietary game distribution platform hosted “on the cloud,” where VIYI interacts with gamers directly, publishes VIYI’s customers’ games and provides software and hardware performance acceleration and optimization through customized central processing algorithms. VIYI’s game distribution platform also uses accurate traffic targeting algorithms to match gamers with suitable games. VIYI’s upstream solutions aim to help VIYI’s customers in the gaming industry to improve the gamer experience and increase conversion rate since VIYI’s solutions tend to reduce the initial cost for buying such games, which tends to increase the willingness for gamers to pay for in-game items or subscriptions.

VIYI’s games distribution platform uses an architecture design that is part terminal and part cloud — “terminal + cloud” — this helps VIYI’s customers to obtain lightweight terminals and low-latency, high-response results. Through the central processing algorithm service, VIYI optimizes algorithms (computing process performed on computers) and computing power (computing capacity of computers) of software algorithms so that end-users game files are small, and the game content is gradually loaded as it is being used, as opposed to loading a large chunk of data at the beginning to maintain smooth operation. Combining with hardware algorithm optimization, VIYI accelerates the computing power and the loading of games at the gamer’s end to improve user experience. VIYI also engages in practical data collection exercises with VIYI’s proprietary algorithms through the game distribution platform; VIYI then analyzes such data for the benefit of VIYI’s customers to improve conversion rates and achieve cost reduction. All of this can be acquired and scaled with VIYI’s bespoke centralized processing algorithms.

VIYI’s platform also provides payment services for gamers to access high-quality and diversified game content. From payment patterns, VIYI’s centralized processing algorithms engage in machine learning to increase the accuracy and efficiency of VIYI’s central processing algorithm service, which results in referrals and more customers while increasing VIYI’s revenue. VIYI’s games distribution platform is essentially a self-sufficient ecosystem providing support to both VIYI’s upstream customers to downstream gamers.

Notably, VIYI’s online application acceleration solutions made possible by VIYI’s central processing algorithms can continuously monitor and optimize the data transmission path of the whole network. These solutions reduce latency and packet loss and provide high-quality real-time participation for millions of concurrent users, which is a solution for not only VIYI’s customers engaged in the games industry but also those in social and online education industries.

According to the CIC Report, VIYI’s gaming platform powered by VIYI’s proprietary central processing algorithm improves the marketing conversion rate of games by 20% through personalized recommendation, acceleration, and convenient distribution, it also significantly improves gamer experience, reduces the cost to VIYI’s customers and improves the retention rate and payment rate of gamers.

From an industry demand perspective, game developers, their corporate customers, and marketing agents have been demanding more effective online game licensing solutions in recent years.

VIYI has mature technology and customer resources in the field of entertainment and game central processing algorithms. With the development of the market, VIYI will continue to grow on the basis of existing customers and strive for a larger market share.

Application of VIYI’s central processing algorithm service in intelligent chip optimization solutions business

VIYI’s intelligent chip industry customers depend on VIYI to provide them with solutions for data processing and optimizing hardware. VIYI’s centralized processing algorithm solution manifests in the form of reducing VIYI’s customer’s energy efficiency ratio through more efficient data services under optimization of algorithm software as well as through equipping instruction chip CPU with intelligent chips such as GPU, FPGA, and ASIC that have incredible computing power. Different CPU and intelligent chip combinations are fitted in accordance with the diverse requirements of data processing and various data type of other industries. VIYI also provides CPUs coupled with integrated smart application solutions. By delivering VIYI’s products directly to customers, VIYI act as the bridge between upstream and downstream businesses in the CPU industry chain.

Currently, the chips applied in the AI field are primarily designed for specific applications and are unable to adapt to the needs of multiple scenarios flexibly. In order to achieve progress in the field of artificial intelligence, an intelligent chip must adapt to the requirements of various algorithms in different scenarios, provide powerful computing power support, and meet the application of terminal scenarios with high energy consumption ratios.

VIYI applies central processing algorithm to intelligent chip optimization. VIYI’s central processing algorithm service has mature technology in chip performance improvement and software application, providing chip products based on solution services and technology development services for customers. Usually, VIYI provides customers with online technical services and support, and VIYI also provides customers with on-site technical solution implementation and technical support. Intelligent chips must be able to change the function dynamically in real-time to meet the changing needs of the software. Software defines hardware, hardware feedback software. Through the central processing algorithm to explore the specific architecture of machine learning, architecture feedback to the central processing algorithm to optimize, to achieve two-way optimization. If a chip is to be deemed practical, it must have robust scalability so that it can be used in more scenarios. The central processing algorithm can make more efficient use of the chip architecture, guide the design of the chip architecture, and transform the computing power into intelligence.

VIYI uses the central processing algorithm, the instruction chip CPU is equipped with GPU, FPGA, ASIC, and other intelligent chips with more outstanding computing power. In order to improve the overall energy efficiency ratio of data service, according to the different data of different industries and their various data processing methods, VIYI uses the CPU to carry different combinations of intelligent chips to realize more efficient data service under the optimization of algorithm software.

By using VIYI’s powerful central processing algorithm technology, VIYI can provide chip optimization solutions for customers’ personalized needs. VIYI provides its customers with the application scheme of the combination of CPU and central processing algorithm. Through more effective use of central processing algorithms, artificial intelligence, cloud computing, and other technologies for chip resources and data scheduling, VIYI can meet the diversified needs of customers. VIYI uses the central processing algorithm service to realize the computing acceleration, data lightweight, and efficiency in the cloud computing application field.

Leveraging VIYI’s central processing algorithm services, VIYI has achieved accelerated computing in cloud computing applications, data lightweight efficiency enhancement, and traffic monetization. VIYI’s strength in intelligent chip optimization solutions business in satisfying the development requirements of mobile and data business has accelerated the transformation of the computing architecture of cloud service providers from a single to a diversified one. Under the multiplier effect generated by the combination of 5G and central processing algorithm service technologies, VIYI will facilitate the effective collaboration of and build an ecosystem for the “terminal-edge- cloud” application scenarios of VIYI’s customers.

According to the CIC Report, benefiting from the development of IoT, cloud computing technology, and the increasing government investment, China’s artificial intelligence market size is in the process of speedy expansion, and it is expected that the scale of core industries will reach RMB 400 billion by 2025, representing an increase of RMB 350 billion between 2020 to 2025. The development of the artificial intelligence market will drive the growth of the central processing algorithm intelligent chip optimization solution industry.

In the future, IoT will provide more data collection terminals, which dramatically enhances the data volume. Big data provides information sources for AI, cloud computing offers a physical carrier for AI, and 5G reduces the delay of data transmission and processing. 5G, IoT, cloud computing all put forward higher data processing, analysis, and other needs and requirements. The central processing algorithm intelligent chip solutions combined with hardware performance optimization, software algorithm optimization, and other vital technologies will make breakthrough progress in the future under the background of the increasingly mature emerging technologies such as 5G, IoT, cloud computing, and big data.

VIYI has effectively established an ecosystem centered around internet advertisement, games, and intelligent chip optimization. VIYI connects with market participants representing every stage in these core industry verticals. They include advertisers, internet advertising integration agencies, internet traffic wholesalers, online platforms, online game developers and distributors, cloud service providers, electronics manufacturers, internet information infrastructure service providers, and internet users, as illustrated in the diagram below:

VIYI’s revenue from digital marketing is derived based on the effectiveness of VIYI’s ad placement. VIYI’s one-stop-shop service solutions enable internet advertising integration agencies to complete cost-effective advertising placements, which allows them to acquire, transform and retain advertisers efficiently.

As cost outlays, VIYI purchases advertisement placement opportunities from internet traffic wholesalers. VIYI also pays corresponding fees to internet traffic wholesalers based on the CPM charging model.

To ensure a continuous stream of revenue, VIYI is constantly updating the inventory of advertisements ready for placement to internet traffic wholesalers with whom VIYI partners. They include short video platforms, video platforms for drama series and films, as well as news and information platforms. VIYI is constantly updating internet traffic wholesalers’ advertisement inventories in real-time for maximum effectiveness. The central processing algorithm services VIYI provides are able to meet these real-time requirements. Therefore, VIYI believes that its services are critical to helping VIYI’s customers to achieve high conversion rates.

VIYI’s revenue from the gaming industry is mainly derived from sales commissions. VIYI collaborated with numerous online game developers and game distributors in operating online games, which are made available on VIYI’s online game platform. VIYI provides online game developers and game distributors with value-added services through customized central processing algorithm processing services, including lightweight data processing, computing power, and algorithm optimizations as well as game acceleration.

VIYI also uses cloud services to ensure that its central processing algorithm services are maintained in a safe and reliable environment.

VIYI’s revenue from the intelligent chip industry is derived from service fees and sales revenue. Electronics manufacturers and internet information infrastructure service providers rely on VIYI’s intelligent chip optimization solutions; VIYI provides them with hardware and software integrated intelligent chip optimization solution services that combine chip hardware and smart application software.

For the years ended December 31, 2020 and 2021, VIYI and the historical VIE had 157 and 196 customers who engaged VIYI and the historical VIE to provide central processing algorithm services, respectively. VIYI focuses its efforts to deepen VIYI’s relationships with existing customers, develop relationships with new and potential customers, and on exploring untapped business opportunities. VIYI’s company has mature business development capabilities and oftentimes rely on customer referrals. As such, VIYI does not require intensive investments in sales modeling. This results in direct cost savings in terms of project travel, public relations, and business entertainment.

In addition, while optimizing the service of central processing algorithm, VIYI is also adjusting its sales strategy with the change of market environment, taking advantage of good service, seeking potential clients in the industry so as to increase VIYI’s revenue and market share rapidly.

VIYI has built deep relationships with its major customers from whom VIYI generates a significant amount of its revenue. These customers include:

Pursuant to advertising service agreements that Korgas 233 Technology Co., Ltd. (“Korgas 233”), a PRC subsidiary of VIYI, entered into with each of the named customers above, Korgas 233 would act as advertising agent for each customer to prepare and place advertisements for brands and products owned by such customers or for which these customers act as an agent. The terms of these contract range between one to two years subject to automatic renewal. Fees payable to Korgas under each contract would be determined based on the effectiveness of such services, which are evaluated pursuant to supplementary agreements prescribing the technical terms of Korgas 233’s services. Each advertising service agreement also permits the customer to terminate the agreement unilateral subject to a 30 day prior notice.

VIYI also works closely with its major suppliers to help provide advertisement services and intelligent chips and services to VIYI’s customers. For the year ended December 31, 2020, VIYI’s major suppliers of products and services include:

With respect to suppliers who provide marketing services, Korgas 233, VIYI’s PRC subsidiary, entered into marketing service framework agreements with each the named marketing services provider, pursuant to which these providers would provide marketing services to Korgas 233 for terms of one to two years. Service fees are payable by Korgas 233 to each service provider on a monthly basis. Either party to these marketing service framework agreements may unilaterally terminate the contract subject to prior notice.

Purchases of central processing units by VIYI are made by Fe-da Electronics, VIYI’s Singaporean subsidiary, which orders directly from each intelligent chips and services supplier named above through purchase orders prepared on market terms typically at the time of the purchase. VIYI’s intelligent chips and service suppliers are dealers for major central processing unit original equipment manufacturers. As such, the central processing units that VIYI purchases from these suppliers enjoy post-purchase service from the manufacturer directly. For example, on December 3, 2020, Fe-da Electronics submitted a purchase order to Global Win Technology Co., Ltd. for the purchase of 3087 pieces of central processing units of one type and 2646 pieces of central processing units of another type. On September 29, 2020, Fe-da Electronics submitted a purchase order to Toyota Tsusho Nexty Electronics Singapore Pte. Ltd. for the purchase of 2000 central processing units.

As of December 31, 2021, VIYI’s research and development team consisted of 98 full-time staff. The professional background of VIYI’s team members include computer, software, computer graphic processing, data algorithm, and neural networks. VIYI’s research and development team has extensive experience, averaging 5 – 8 years of working experience, and is responsible for the design and development of solutions for VIYI’s central processing algorithms services such as digital graphic lightweight, algorithm, data intelligence, and image synthesis.

VIYI is committed to continuously strengthening and updating VIYI’s information technology infrastructure and other technologies according to VIYI’s annual development plan and based on VIYI’s assessment of market demand. The process of VIYI’s self-development research and development is as follows: (1) research and development personnel raises new ideas for research and development based on the market situation and customers’ needs to complete the investigation report and decision analysis; (2) project approval and formulate product research and development plan; (3) development of product technology; (4) product testing and review; (5) launching of new product; (6) promotion and application of the new product.

Intellectual property rights are critical to VIYI’s success and competitiveness. VIYI relies on a combination of trademarks, patents, domain names, copyrights, and employee confidentiality agreements to protect VIYI’s intellectual property rights. As of December 31, 2021, VIYI owned:

all of which are material to VIYI’s business. Notably, the quantity of intellectual property in VIYI’s possession is the highest out of all VIYI’s competitors, according to the CIC Report.

There are other companies addressing various aspects/verticals of the central processing algorithm service market in the PRC. The central processing algorithm service market is highly fragmented and evolving. With respect to VIYI’s central processing algorithm services, VIYI competes against other companies engaged in similar services like VIYI.

VIYI believes it competes favorably on the basis of the above factors; however, VIYI expects competition to intensify in the future. VIYI’s ability to remain competitive will largely depend on the quality of its applications, the effectiveness of VIYI’s sales and marketing efforts, the quality of VIYI’s customer service, and VIYI’s ability to acquire or develop complementary technologies, products, and businesses to enhance the features and functionality of VIYI’s applications.

VIYI had 163 full-time employees, respectively, as of December 31, 2021. As of the date of this proxy statement, all of VIYI’s employees are based in China.

The following table sets forth the number of VIYI’s employees as of December 31, 2021:

Under PRC law, VIYI participates in various employee social security plans that are organized by municipal and provincial governments for VIYI’s PRC-based full-time employees, including pension, unemployment insurance, childbirth insurance, work-related injury insurance, medical insurance, and housing fund. VIYI is required under PRC law to make contributions monthly to employee benefit plans for VIYI’s PRC-based full-time employees at specified percentages of the salaries, bonuses, and certain allowances of such employees, up to a maximum amount determined by the local governments in China.

VIYI enters into labor contracts and standard confidentiality and non-compete agreements with VIYI’s key employees. VIYI believes that VIYI maintains a good working relationship with VIYI’s employees, and VIYI has not experienced any labor disputes. None of VIYI’s employees are represented by labor unions.

VIYI’s headquarters are located in Shenzhen, China, and VIYI maintains offices in Unit 507, Building C, Taoyuan Street, Long Jing High and New Technology Jingu Pioneer Park, Nanshan District, Shenzhen, 518052. VIYI believes that its existing facilities are adequate for VIYI’s current requirements and that additional space can be obtained on commercially reasonable terms to meet VIYI’s future needs.

VIYI does not maintain insurance policies covering damages to VIYI’s Information Technology systems. Neither does VIYI carry business interruption insurance or general third-party liability insurance, or have product liability insurance or key-man insurance. VIYI considers its insurance coverage to be in line with that of other companies in the same industry of similar size in China.

VIYI may be subject to legal proceedings, investigations, and claims incidental to the conduct of VIYI’s business from time to time. VIYI is not currently a party to, nor is VIYI aware of, any legal proceedings, investigations, or claims which, in the opinion of VIYI’s management, are likely to have a material adverse effect on VIYI’s business, financial condition, or results of operations.

The following selected consolidated statements of income and comprehensive income for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022, selected consolidated balance sheet data as of December 31, 2020 and 2021 and June 30,2022 and selected consolidated cash flow data for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022 have been derived from VIYI’s audited consolidated financial statements included elsewhere in this proxy statement and have been prepared on the same basis as VIYI’s audited consolidated financial statements and include all adjustments, consisting only of normal and recurring adjustments, that VIYI considers necessary for a fair statement of VIYI’s financial position and operating results for the periods presented. The historical results included below and elsewhere in this proxy statement are not indicative of VIYI’s future performance. You should read this Selected Historical Consolidated Financial and Operating Data section together with VIYI’s consolidated financial statements and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of VIYI” contained elsewhere herein.

The following table represents VIYI’s selected consolidated balance sheet data as of December 31, 2020 and 2021 and June 30, 2022:

The following table represents VIYI’s selected consolidated cash flow data for the years ended December 31, 2020 and 2021 and for the six months ended June 30, 2021 and 2022:

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS OF VIYI

You should read the following discussion and analysis in conjunction with VIYI’s consolidated financial statements, which VIYI has prepared in accordance with GAAP, included elsewhere in this proxy statement. This discussion contains forward-looking statements that involve risks and uncertainties. VIYI’s actual results and timing of events could differ materially from those anticipated in these forward-looking statements due to various factors, including those set forth under “Risk Factors” and elsewhere in this proxy statement.

VIYI is dedicated to the development and application of bespoke central processing algorithms. VIYI provides comprehensive solutions to customers by integrating central processing algorithms with software or hardware, or both, to streamline their digital services for end-users or technological development purposes, thereby helping them increase the number of customers, improve end-user satisfaction, achieve direct cost savings, reduce power consumption, and achieve technical goals. The range of VIYI’s services includes algorithm optimization, accelerating computing power without the need for hardware upgrades, lightweight data processing, and data intelligence services. VIYI’s ability to efficiently deliver software and hardware optimization to VIYI’s customers through bespoke central processing algorithms serves as a driving force for VIYI’s long-term development.

Currently, VIYI’s technology and solutions are mainly in the field of internet multimedia video advertising, internet gaming entertainment, where VIYI has historically been successful in providing advertising distribution solutions, online game agent solutions, software services, and comprehensive solutions for enterprise customers. VIYI also developed its intelligent chips solutions through its 100% owned subsidiary Fe-da Electronics as VIYI believes that the demand for algorithms in the semiconductor sector is growing rapidly, representing huge market potentials.

In the mid-to-long term, VIYI will continue to adhere to its strategic mindset. By improving upon each iteration of VIYI’s one-stop intelligent data management solutions made possible by VIYI’s proprietary central processing algorithm services, VIYI can help customers to enhance their service efficiency and make model innovations in business, and actively enhance the industry value of the central processing algorithm services in the general field of data intelligent processing industry.

VIYI derives its revenue primarily from (i) central processing algorithms services for the internet advertisement and internet gaming industries (“CPA”) and (ii) intelligent chips and services, including software development.

VIYI’s revenue for the six months ended June 30, 2022 was RMB 345.8 million, which represents an increase of RMB 116.9 million, or 51.1%, from VIYI’s total revenues of RMB 228.9 million for the six months ended June 30, 2021. VIYI’s gross profit for the six months ended June 30, 2022 was RMB 69.3 million, representing a decrease of RMB 51.6 million, or 42.7%, from RMB 120.9 million for the six months ended June 30, 2021. VIYI’s operating expenses for the six months ended June 30, 2022 was RMB 55.0 million, representing a decrease of RMB 5.0 million, or 8.3%, from RMB 60.0 million for the six months ended June 30, 2021. VIYI’s net income for the six months ended June 30, 2022 was RMB 15.2 million, representing an decrease of RMB 48.5 million, or 76.1%, from RMB 63.7 million for the six months ended June 30, 2021.

VIYI’s revenue for the year ended December 31, 2021 was RMB 529.3 million, which represents an increase of RMB 221.5 million, or 72.0%, from VIYI’s total revenues of RMB 307.8 million for the year ended December 31, 2020. VIYI’s gross profit for the year ended December 31, 2021 was RMB 213.7 million, representing an increase of RMB 88.5 million, or 70.7%, from RMB 125.2 million for the year ended December 31, 2020. VIYI’s operating expenses for the year ended December 31, 2021 was RMB161.2 million, representing an increase of RMB 130.6 million, or 419.9%, from RMB 31.1 million for the year ended December 31, 2020. VIYI’s net income for the year ended December 31, 2021 was RMB 54.7 million, representing an decrease of RMB 36.8 million, or 40.2%, from RMB 91.5 million for the year ended December 31, 2020.

VIYI believes that its future performance and success depend to a substantial extent on the following factors, each of which is in turn subject to significant risks and challenges, including those discussed below and in the section of this proxy statement entitled “Risk Factors.”

A significant amount of VIYI and its historical VIE’s revenues are derived from the provision of central processing algorithm services, as such VIYI and its historical VIE’s profitability is highly dependent on their ability to retain and increase customers who engage VIYI in providing central processing algorithm services. For the years ended December 31, 2020 and 2021 and the six months ended June 30, 2022, VIYI, its subsidiaries and its historical VIE had 157, 196 and 198 customers in the CPA segment, respectively, of which 57, 66 and 2 are new customers.

Since September 2020, VIYI also began developing its intelligent chips and services business, and has accumulated 12, 52, 48 customers for the periods ended December 31, 2020, and 2021 and for the six months ended June 30, respectively.

The average revenues per customer in the CPA segment were approximately RMB 1,100,000, RMB 1,400,000 and RMB 1,300,000, respectively for the years ended December 31, 2020 and 2021 and for the period ended June 30, 2022. Average revenue per customer in VIYI’s CPA segment, calculated as the total revenues for the given period divided by the number of customers during the period who have obtained VIYI’s services. Customer retention rates for CPA segment for the same periods were 80.6%, 82.8% and 98.4%, respectively, whereas retention rate for intelligent chips and services was 100% and 93.2% for the periods ended December 31, 2021, and June 30, 2022. Retention rate is calculated by first counting the number of existing customers at the beginning of the period (denominator) and the number of those customers who are still active at the end of the following period (numerator), then dividing the numerator by the denominator.

The quantitative information in the number of customers, the number of new customers, and average revenue per customer provides investors with information to evaluate VIYI’s revenue growth and concentration of revenue on a periodic basis to evaluate the trend which could be relevant to investors while customer retention rate will provide investors with information about VIYI’s ability to retain customers which is an indicator of the stability of VIYI’s revenue base. This information also provides investors insights on how VIYI measures and monitors its performance.

VIYI’s management team monitors the number of customers and the number of new customers as indicators of the growth of VIYI’s overall business. The increase in new customers indicates the effectiveness of VIYI’s business expansion and reflects VIYI’s strong business development capabilities. The retention rate shows that VIYI has high service quality, which can meet customer needs and provide its customers with value. At the same time, the retention rate of customers also guarantees the stable growth VIYI’s business. If the number of new customers and retention rate fall, VIYI may need to re-evaluate its business strategy or evaluate its service efficiency.

VIYI’s ability to increase customers, average revenue per customer and retention rate will depend on the development of the internet advertising, online gaming and intelligent chips market and its ability to continue to enhance the quality and capabilities of its algorithms which enabled VIYI to provide better services for customers. The demand for VIYI’s services has grown in recent years, and VIYI believes that the number of customers will continue to grow due to the increase in a general demand for more efficient data processing in various industries driven by the growing internet population and expect that retention rates will remain at high levels in the long term as VIYI continues to build stable cooperation relationship with its customers.

VIYI expends considerable capital and efforts in the research and development of algorithmic use cases and product solutions to maintain VIYI’s competitiveness in the computer and internet industries. In light of the rapid growth of data volume, data processing capabilities are the key to enterprise development, which requires the advancement of technology related to central processing algorithms, new services, products, and capabilities to newer stages of development. To retain existing customers and attract potential customers, VIYI must continue to innovate to keep pace with the growth of the industry and VIYI’s business to bring forward new cutting-edge technologies. VIYI’s current research and development efforts primarily focus on enhancing its artificial intelligence

technology, image processing technology, intelligent chips, and application solutions to create novel service and product offerings. VIYI spent approximately RMB 14.9 million, RMB 107.0 million and RMB 40.2 million (USD 3.2 million) on research and development for the years ended December 31, 2020, 2021 and for the six months ended June 30, 2022, respectively.

China’s increased demand for central processing algorithm services in internet advertisement and the online game industry

Effective central processing algorithm solutions can empower downstream industries experiencing high demand for data analysis and computing power optimization, which applies to internet advertising, internet game applications, finance, retail, logistics, and other industries. Because of huge downstream demands, the overall market of central processing algorithm services is enormous.

According to the CIC Report, revenue of central processing algorithm services derived from internet advertisement and online gaming alone has grown from RMB 2.2 billion in 2016 to RMB 6.9 billion in 2020, representing a CAGR of 32.7%. This market is expected to maintain a rapid growth trend, expanding at a CAGR of 15% during the period from 2020 to 2025. VIYI believes that its position as an industry leader in a fast-growing market with favorable industry trends will greatly benefit VIYI in achieving sustainable and rapid growth in the future.

VIYI intends to continually pursue strategic acquisitions and investments in selective technologies and businesses in the central processing algorithm and semiconductor industries to enhance VIYI’s technology capabilities. VIYI believes that a solid acquisition and investment strategy may be critical for VIYI to accelerate VIYI’s growth and strengthen its competitive position in the future. VIYI’s ability to identify and execute strategic acquisitions and investments will likely affect VIYI’s operating results over time. Please see “Business — VIYI’s Strategies” for more information on VIYI’s growth strategies.

VIYI’s ability to expand its application fields and to diversify its customer base

Currently, the primary source of VIYI’s revenue is derived from providing central processing algorithm solutions to businesses in the entertainment and internet advertisement industries. With increasing awareness and acceptance of this technology, VIYI expects that more applications will be identified to magnify the value of this technology, such as the industry of the Internet, finance, local government, and manufacturing industries that have strong demand for data empowerment. Expand the scenario application of central processing algorithm services. VIYI’s ability to expand its application fields and diversify its customer base may affect VIYI’s operating results in the future.

VIYI temporally closed its offices and implemented a work from home policy in February 2020, as required by relevant PRC regulatory authorities. Since March 16, 2020, VIYI’s offices have reopened and have been fully operational. Due to the nature of VIYI’s business, the impact of the closure on VIYI’s operational capabilities was not significant, as most of VIYI’s workforce continued working offsite during such closure. In addition, the situation may worsen if the COVID-19 outbreak and the outbreak of certain other COVID-19 variants resurges, and VIYI’s customers may request additional time to pay VIYI or fail to pay VIYI on time, or at all, which may require VIYI to record additional allowances. VIYI has not experienced significant collection issues so far. VIYI has closely monitored its collections throughout 2020 and 2021 and will be continuing to monitor collections from 2022 and

beyond. The resurgence of COVID-19 variant in last quarter of 2021in South East Asia has negatively impacted VIYI’s subsidiary Fe-da’ operations. As a result from reducing profit projections due to supply chain shortage, Fe-da recorded a goodwill impairment charge of approximately RMB 18.5 million (USD 2.9 million).

As a result of the resurgence of COVID-19 variants in first quarter of 2022 in China, VIYI’s office in the PRC was again closed for one week in first quarter of 2022. VIYI resumed normal operation since April, 2022. VIYI’s customers have been impacted as a result of business disruption due to closures in various cities, which affected their customers’ advertising spending. As a result, VIYI experienced lower revenue growth on advertising which affected VIYI’s gross margin.

Any further impact on VIYI’s results will depend on, to a large extent, future developments and new information that may emerge regarding the duration and resurgence of COVID-19 variants and the actions taken by government authorities to contain COVID-19 or treat its impact, almost all of which are beyond VIYI’s control.

VIYI currently operates in two segments and generates revenue by providing (i) central processing algorithm services and (ii) intelligent chips and services. Please see VIYI’s consolidated financial statements included elsewhere in this proxy statement for additional information regarding VIYI’s operations.

VIYI’s revenues consist of (i) providing central processing algorithm solutions, including internet advertising solutions, internet games services, and (ii) intelligent chips and services revenues.

Cost of revenue for VIYI’s central processing algorithm solutions for the internet advertisement algorithm services, internet games services comprised of (i) costs paid to channel providers and shared costs with content providers based on the profit-sharing arrangements, (ii) third party consulting services expenses and (iii) compensation expenses for the VIYI’s professionals.

Cost of revenue for VIYI’s intelligent chip and services consists primarily of the costs of products sold and third-party software development costs.

VIYI’s selling expenses consist primarily of (i) compensation for selling personnel and (ii) travel expenses for its sales representatives.

VIYI’s general and administrative expenses consist primarily of (i) compensation for its management and administrative personnel, (ii) expenses in connection with its operation supporting functions such as legal, accounting, consulting and other professional service fees, and (iii) office rental, depreciation, and other administrative related expenses.

VIYI’s research and development expenses include salaries and other compensation-related expenses to VIYI’s research and product development personnel, outsourced subcontractors, as well as office rental, depreciation, and related expenses for VIYI’s research and product development team.

The following table summarizes VIYI’s consolidated results of operations for the six months ended June 30, 2021 and 2022, and for the year ended December 31, 2020 and 2021. This information should be read together with VIYI’s consolidated financial statements, and related notes included elsewhere in this proxy statement.

Six Months Ended June 30, 2021, Compared to the Six Months Ended June 30, 2022

VIYI’s total revenues increased by approximately RMB 116.9 million, or 51.1%, from approximately RMB 228.9 million for the six months ended June 30, 2021, to approximately RMB 345.8 million (USD 51.5 million) for six months ended June 30, 2022, due to an increase of approximately RMB 135.5 million (USD 20.2 million) in central processing algorithm service revenue, and an decrease of approximately RMB 18.7 million (USD 2.8 million) in intelligent chips and services revenue.

VIYI’s breakdown of revenues for the six months ended June 30, 2021 and 2022, respectively, is summarized below:

VIYI generates revenues from advertising display services when VIYI completes its performance obligation to deliver related advertising services based on the specific terms of the contract, which are commonly based on a specific action, e.g., cost per impression (“CPM”) for online display. Over 90% of VIYI’s advertising display services contracts with these customers are based on the CPM charging model. Revenue from performance based advertising services is generated when traffic users completed a transaction as specified in contracts. Revenues generated from mobile games include royalty payments from licensee operators of VIYI’s mobile games and fees collected from game developers for using VIYI’s game portal.

VIYI’s central processing algorithm services revenue increased by approximately RMB 135.5 million, or 108.1%, from approximately RMB 125.4 million for the six months ended June 30, 2021, to approximately RMB 260.9 million (USD 38.9 million) for the six months ended June 30, 2022. This increase was primarily attributable to the overall market demand for internet advertising, which resulted in an increase of the number of customers from 167 to 198 as of June 30, 2021, and June 30, 2022, respectively, representing an 18.6% increase. Approximately 23.6% or RMB 32.0 million (USD 4.8 million) of the increase in CPA segment was from performance based advertising services in 2022. Approximately 73.7% increase was due to increase advertising revenue from short form videos as VIYI started provide advertising services in videos streaming market in 2022.

VIYI’s revenue from the resale of intelligent chips and accessories amounted to approximately RMB 84.9 million (USD 12.6 million) for the six months ended June 30, 2022, which is a decrease of 18.8 million from RMB 103.6 million for the six months ended June 30, 2021, representing a 18.1% decrease. The decrease was mainly due to decrease in software development revenue where customer development has been delayed in first quarter due to COVID-19. VIYI expects that as the demand for custom optimizations by way of VIYI’s proprietary algorithms grows, VIYI’s intelligent chips and services revenue will continue to grow in the long run. For semiconductor application solutions related to algorithm optimization, VIYI plans to combine algorithm optimization application demand scenarios, provide corresponding central processing algorithm solutions to meet market demand, and promote the application and popularization of algorithm optimization technology in the semiconductor field.

For VIYI’s central processing algorithm services, the cost of revenues consists of the costs paid to (i) channel providers and shared costs with content providers based on the profit-sharing arrangements, (ii) third-party consulting services expenses, and (iii) compensation expenses for VIYI’s professionals.

For intelligent chips and services, the cost of revenue consists primarily of the costs of products sold and third-party software development costs.

VIYI’s total cost of revenues increased by approximately RMB 168.3 million, or 155.7%, from approximately RMB 108.1 million the six months ended June 30, 2021, to approximately RMB 276.4 million (USD 41.2 million) for the six months ended June 30, 2022.

VIYI’s breakdown of cost of revenues for the six months ended June 30, 2021 and 2022, respectively, is summarized below:

VIYI’s cost of revenues for central processing algorithm services increased by approximately RMB 171.7 million, or 711.6%, from approximately RMB 24.1 million for the six months ended June 30, 2021, to approximately RMB 195.8 million (USD 29.2 million) for the six months ended June 30, 2022. The increase in the cost of revenues was mainly due to channel costs, which the Company has incurred channel costs with major internet advertising outlets such as internal portal, platform or applications to secure advertising space. In addition, approximately 78.7% of the cost increase was due to increase in revenue in related to short form videos on various platforms.

VIYI’s cost of revenues for intelligent chips and accessories was approximately RMB 83.9 million for the six months ended June 30, 2021 compared to approximately RMB 80.6 million (USD 12.0 million) for the six months ended June 30, 2022 which are mainly product costs.

VIYI’s gross profit decreased by approximately RMB 51.6 million, from approximately RMB 120.9 million for the six months ended June 30, 2021, to approximately RMB 69.3 million (USD 10.3 million) during the six months ended June 30, 2022. For the six months ended June 30, 2021, and 2022, VIYI’s overall gross margin was 52.8% and 20.1%, respectively.

VIYI’s gross profit and gross profit margin from its major business segments are summarized as follows:

VIYI’s gross margins for central processing algorithm services were 80.8% and 25.0% for the six months ended June 30, 2021, and 2022, respectively. The decrease in margin was due to the increase in cost of revenue with advertising channels whereas revenue growth was at a slower pace due to impact of COVID 19 in first quarter of 2022. In addition, the gross margin was lower for short form video advertising as a few channels dominated the market.

VIYI’s gross margin for intelligent chips and services was 19.0% for the six months ended June 30, 2021 compared to 5.0% for six months ended June 30, 2022 due to decrease in software development revenue.

For six months ended June 30, 2022, VIYI incurred approximately RMB 55.0 million (USD 8.2 million) in operating expenses, representing a decrease of approximately RMB 5.0 million, or 8.3%, from approximately RMB 60.0 million for six months ended June 30, 2021, primarily due to decreases in as a research and development expenses as a result of impact of COVID-19.

Selling expenses decreased by approximately RMB 0.3 million, or 10.7%, from approximately RMB 2.8 million for the six months ended June 30, 2021, to approximately RMB 2.5 million (USD 0.4 million) for the six months ended June 30, 2022. The decrease was mainly due to the decreased marketing activities during first quarter of 2022 due to the impact of COVID-19 which caused closures of public areas in several cities in China.

General and administrative expenses decreased by approximately RMB 0.3 million, or 2.4%, from RMB 12.6 million for the six months ended June 30, 2021, to approximately RMB 12.3 million (USD 0.8 million) for the six months ended June 30, 2022. The decrease was mainly due to (i) the recovery of bad debt expenses of approximately RMB 1.9 million as VIYI followed up closely with collections, (ii) travel and meeting related expenses of approximately RMB 1.4 million due to travel restriction in various cities due to the pandemic, and (iii) the decrease in depreciation and amortization expenses of approximately RMB 0.6 million as a result of fully amortization of Yitian’s intangible assets. The decrease was partially offset by the increase in (i) professional fee of approximately RMB 2.2 million which are mainly VIYI’s expenses related to the coming merger including audit and consulting expenses, (ii) salary and benefit expenses of approximately RMB 1.3 million, VIYI has an average of 28 and 46 employees in the administrative department for the six months ended June 30, 2021 and 2022, respectively.

Research and development expenses decreased by approximately RMB 4.3 million, or 9.7%, from approximately RMB 44.5 million for the six months ended June 30, 2021, to approximately RMB 40.2 million (USD 6.0 million) for the six months ended June 30, 2022. The decrease was mainly due to the slowdown in the progress of outsourced technical development services as a result of impact from COVID-19. VIYI incurred approximately RMB 42.6 million in outsourced technical development services for the six months ended June 30, 2021, to approximately RMB 37.3 million for the six months ended June 30, 2022.

Total other income, net, for six months ended June 30, 2021, was approximately RMB 2.6 million compared to other income, net of RMB 0.4 million (USD 56,623) for the six months ended June 30, 2022. The decrease in other income was primarily due to the decrease of interest income of approximately of RMB1.9 million (USD 288,000), or 86.4% due to VIYI deposited less funds in time deposit. Loss from short term investment of approximately RMB 1.1 million as Shenzhen Weiyixin invested in short term investment with underlying in equity funds. The decrease was partially offset by the increase in and VAT credit of approximately RMB 0.6 million (USD 90,000).

VIYI’s income tax expenses increased by approximately RMB 0.5 million, or 61.8%, from approximately RMB 0.8 million for six months ended June 30, 2021, to approximately RMB 0.3 million (USD 47,493) for the six months ended June 30, 2022. The increase was mainly due to increase in taxable income in subsidiaries with higher tax rate mainly Shenzhen Qianhai and Weidong.

As a result of the combination of factors discussed above, VIYI’s net income decreased from approximately RMB 63.7 million for the six months ended June 30, 2021, to approximately RMB 15.2 million (USD 2.3 million) for the six months ended June 30, 2022. After the deduction of non-controlling interest, net income attributable to VIYI was approximately RMB 63.9 million for the six months ended June 30, 2021, compared to approximately RMB 15.0 million (USD 2.2 million) for the same period in 2022. Comprehensive income attributable to VIYI was approximately RMB 63.4 million for the six months ended June 30, 2021, compared to approximately RMB 16.4 million (USD 2.4 million) for the same period in 2022.

VIYI’s total revenues increased by approximately RMB 221.5 million, or 72.0%, from approximately RMB 307.8 million for the year ended December 31, 2020, to approximately RMB 529.3 million (USD 83.0 million) for the year ended December 31, 2021, due to an increase of approximately RMB 123.2 million (USD 19.3 million) in central processing algorithm service revenue, and an increase of approximately RMB 98.2 million (USD 15.4 million) in intelligent chips and services revenue.

VIYI’s breakdown of revenues for the years ended December 31, 2020 and 2021, respectively, is summarized below:

advertising services is generated when traffic users completed a transaction as specified in contracts. Revenues generated from mobile games include royalty payments from licensee operators of VIYI’s mobile games and fees collected from game developers for using VIYI’s game portal. VIYI’s central processing algorithm services revenue increased by approximately RMB 123.2 million, or 82.3%, from approximately RMB 149.8 million for the year ended December 31, 2020, to approximately RMB 273.0 million (USD 42.8 million) for the year ended December 31, 2021. This increase was primarily attributable to the overall market demand for internet advertising and gaming, which resulted in an increase of the number of customers from 157 to 191 as of December 31, 2020, and December 31, 2021, respectively, representing a 21.7% increase. Approximately 25.2% or RMB 31.0 million (USD 4.9 million) of the increase in CPA segment was from performance based advertising services in 2021.

Intelligent chips and services revenues include revenues generated from the resale of intelligent chips. VIYI generates revenues when the control of products is transferred to customers, as evidenced by customers’ signed acceptances. VIYI also generates revenues from software development. VIYI designs software for central processing units based on customers’ specific needs. Revenues from software development are recognized over time during the development period.

VIYI began generating revenue from the resale of intelligent chips and related software development in September 2020 and also through VIYI’s acquisition of Fe-da Electronics, which amounted to approximately RMB 256.2 million (USD 40.2 million) for the year ended December 31, 2021, an increase of 98.2 million from RMB158.0 million for the year ended December 2020. Approximately 98.7% of the increase in intelligent chips and services revenue was due to the acquisition of Fe-da Electronics. VIYI expects that as the demand for custom optimizations by way of VIYI’s proprietary algorithms grows, VIYI’s intelligent chips and services revenue will continue to grow in the long run although the growth was temporarily slow downed by the impact of COVID-19 which affected VIYI’s operation in South East Asia. For semiconductor application solutions related to algorithm optimization, VIYI plans to combine algorithm optimization application demand scenarios, provide corresponding central processing algorithm solutions to meet market demand, and promote the application and popularization of algorithm optimization technology in the semiconductor field.

For intelligent chips and services, the cost of revenue consists primarily of the costs of products sold and third-party software development costs.

VIYI’s total cost of revenues increased by approximately RMB 133.0 million, or 72.8%, from approximately RMB 182.6 million for the year ended December 31, 2020, to approximately RMB 315.6 million (USD 50.0 million) for the year ended December 31, 2021.

VIYI’s breakdown of cost of revenues for the years ended December 31, 2020 and 2021, respectively, is summarized below:

VIYI’s cost of revenues for central processing algorithm services increased by approximately RMB 28.9 million, or 42.5%, from approximately RMB 68.0 million for the year ended December 31, 2020, to approximately RMB 96.9 million (USD 15.2 million) for the year ended December 31, 2021. The increase in the cost of revenues was in line with the increase in central processing algorithm advertising and mobile services revenue.

VIYI’s cost of revenues for intelligent chips and services was approximately RMB 114.6 million for the year ended December 31, 2020 compare to approximately RMB 218.7 million (USD 34.3 million) for the year ended December 31, 2021. VIYI expects the cost of revenues of intelligent chips and services will rise in line with VIYI’s expectation of intelligent chips and services revenue growth and further if supply chain shortage continue in 2022. Approximately 97.4% of the increase in cost of revenues for intelligent chips and services was due to the acquisition of Fe-da Electronics.

VIYI’s gross profit increased by approximately RMB 88.5 million, from approximately RMB 125.2 million for the year ended December 31, 2020, to approximately RMB 213.7 million (USD 33.5 million) during the year ended December 31, 2021. For the years ended December 31, 2020, and 2021, VIYI’s overall gross margin was 40.7% and 40.4%, respectively.

VIYI’s gross profit and gross profit margin from its major business segments are summarized as follows:

VIYI’s gross margin for central processing algorithm services were at 54.6% and 64.5% for the year ended December 31, 2020, and 2021, respectively. The increase in margin was due to improvement in technology where VIYI’s algorithm could allow more advertisements to be placed from the same internet traffic, thus reducing its channel costs. The increase in margin may not be a continuous trend as there is still limitation in current technology, but VIYI is continuing to make technological innovations in central processing algorithms to improve efficiency.

VIYI’s gross margin for intelligent chips and services was 27.5% for the year ended December 31, 2020 compared to 14.6% for the year ended December 31, 2021 due to increase in costs of products sold as a result of supply chain shortage.

For the year ended December 31, 2021, VIYI incurred approximately RMB 161.7 million (USD 25.4 million) in operating expenses, representing an increase of approximately RMB 130.6 million, or 419.9%, from approximately RMB 31.1 million for the year ended December 31, 2020, primarily due to significant increases in research and development expenses in line with VIYI’s development strategies.

Selling expenses increased by approximately RMB 3.6 million, or 200.0%, from approximately RMB 1.8 million for the year ended December 31, 2020, to approximately RMB 5.4 million (USD 0.3 million) for the year ended December 31, 2021. The increase was mainly due to increased salary and benefit expenses for VIYI’s sales team due to increasing numbers of employees’ as VIYI set up or acquired new subsidies since May 2020. VIYI has an average of 10 and 57 employees in the selling department for the years ended December 31, 2020 and 2021, respectively.

General and administrative expenses increased by approximately RMB 19.6 million, or 136.1%, from RMB 14.4 million for the year ended December 31, 2020, to approximately RMB 34.0 million (USD 5.3 million) for the year ended December 31, 2021. The increase was mainly due to an increase in (i) professional fees, including consulting, accounting, and other professional fees of approximately RMB 9.6 million, and (ii) depreciation and amortization expenses of approximately RMB 4.4 million as a result of amortization of intangible assets from

acquisition, (iii) increase in salary and benefit expenses of approximately RMB 6.0 million due to the increasing number of VIYI’s employees as VIYI set up or acquired new subsidies since May 2020. VIYI has an average of 9 and 29 employees in the administrative department for the years ended December 31, 2020 and 2021, respectively, and (iv) the increase in related office expenses of approximately RMB 2.0 million as VIYI formed more entities in the year 2021. The increase was partially offset by the decrease share-based compensation expenses of approximately RMB 3.9 million.

Research and development expenses increased by approximately RMB 92.1 million, or 618.1%, from approximately RMB 14.9 million for the year ended December 31, 2020, to approximately RMB 107.0 million (USD 16.8 million) for the year ended December 31, 2021. The increase was attributable to the increase in research and development of applications for central processing algorithms in cloud computing, artificial intelligence, big data, 5G, and other areas. VIYI incurred approximately RMB 91.9 million in outsourced technical development services for these areas of research and development to further VIYI’s technological capabilities to maintain VIYI’s competitive advantage in providing central processing algorithms.

Goodwill impairment loss amounted to approximately RMB 18.5 million (USD 2.9 million) for the year ended December 31, 2021 which was associated with VIYI’s intelligent chips segment. The impairment charge was driven by a decline in forecasted profit in the segment as a result of the impact from COVID-19 which affected supply chain of chips in last quarter of 2021.

Change in fair value of business acquisition payable amounted to RMB 3.2 million (USD 0.5 million) for the year ended December 31, 2021. The Company is contractually obligated to pay contingent consideration to the sellers of Fe-da in the event that certain net income targets are achieved during the three years following acquisition. The net income target were not met for the year ended December 31, 2021. VIYI’ management, with the assistance of third party appraiser determined the fair value of contingent consideration was nil for the year ended December 31, 2021 based on a probability weighted discounted cash flow analysis with significant fair value input being the financial performance of Fe-da.

Total other expenses, net, for the year ended December 31, 2020, was approximately RMB 0.2 million compared to other income, net of RMB 3.4 million (USD 526,000) for the year ended December 31, 2021. The increase in other income was primarily due to the increase in interest income of approximately RMB 1.8 million from our time deposit with maturity less than 30 days deposited in banks, income from short term investment of approximately RMB 1.3 million, government subsidies of approximately 0.3 million (USD 45,000) and VAT credit of approximately RMB 1.7 million (USD 0.3 million).

VIYI’s income tax expenses decreased by approximately RMB 1.9 million, or 79.2%, from approximately RMB 2.4 million for the year ended December 31, 2020, to approximately RMB 0.5 million (USD 0.03 million) for the year ended December 31, 2021. The decrease was mainly due to decrease in current income tax of approximately of RMB 1.1 million, or 31.4% as result of decrease in taxable income, combine with the approximately RMB 0.8 million of income tax benefit as a result of reversal of deferred tax liability from amortization of intangible from acquisition of Fe-da Electronics and Guoyu.

As a result of the combination of factors discussed above, VIYI’s net income decreased from approximately RMB 91.5 million for the year ended December 31, 2020, to approximately RMB 54.7 million (USD 8.6 million) for the year ended December 31, 2021. After the deduction of non-controlling interest, net income attributable to VIYI was approximately RMB 91.5 million for the year ended December 31, 2020, compared to approximately RMB 55.3 million (USD 8.7 million) for the same period in 2021. Comprehensive income attributable to VIYI was approximately RMB 89.4 million for the year ended December 31, 2020, compared to approximately RMB 54.3 million (USD 8.5 million) for the same period in 2021.

VIYI prepares financial statements in conformity with U.S. GAAP, which requires VIYI’s management to make assumptions, estimates, and judgments that affect the amounts reported, including the notes thereto, and related disclosures of commitments and contingencies, if any. VIYI has identified certain accounting policies that are significant to the preparation of VIYI’s financial statements. These accounting policies are important for an understanding of VIYI’s financial condition and results of operation. Critical accounting policies are those that are most important to the portrayal of VIYI’s financial conditions and results of operations and require management’s difficult, subjective, or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the possibility that future events affecting the estimate may differ significantly from management’s current judgments. While VIYI’s significant accounting policies are described in more detail in Note 2 to VIYI’s audited consolidated financial statements included elsewhere in this proxy statement, VIYI believes the following critical accounting policies involve the most significant estimates and judgments used in the preparation of VIYI’s financial statements.

The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP for information pursuant to the rules and regulations of the SEC.

The consolidated financial statements include the financial statements of VIYI and its subsidiaries, which include Shenzhen Weiyixin and its subsidiary, Shenzhen Yitian and its subsidiaries over which VIYI exercises control and, when applicable, entities for which VIYI has a controlling financial interest or is the primary beneficiary. All transactions and balances among VIYI and its subsidiaries have been eliminated upon consolidation.

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in VIYI’s consolidated financial statements include the useful lives of property and equipment and intangible assets, impairment of long-lived assets and goodwill, allowance for doubtful accounts, provision for contingent liabilities, revenue recognition, deferred taxes, and uncertain tax position, purchase price allocations for business combinations, the fair value of contingent consideration related to business acquisitions, allocation of share-based compensation and allocation of expenses from WiMi and Beijing WiMi. Actual results could differ from these estimates.

The purchase price of an acquired company is allocated between tangible and intangible assets acquired and liabilities assumed from the acquired business based on their estimated fair values, with the residual of the purchase price recorded as goodwill. Transaction costs associated with business combinations are expensed as incurred and are included in general and administrative expenses in VIYI’s consolidated statements of operations. The results of operations of the acquired business are included in VIYI’s operating results from the date of acquisition.

On September 28, 2020, VIYI acquired 100% equity interests of Fe-da Electronics with an acquisition consideration at a fair value of approximately USD 15.2 million (RMB 103.4 million). VIYI estimated the fair value of consideration, including any contingent consideration based on the present value of the probability-weighted expected amount of the future payments. VIYI then allocated the fair value of consideration of Fe-da Electronics based upon the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date. VIYI estimated the fair values of the assets acquired and liabilities assumed at the acquisition date per the Business Combination standard issued by the FASB with the valuation methodologies using level 3 inputs, except for other current assets and current liabilities that were valued using the cost approach. VIYI’s management is responsible for determining the fair value of assets acquired, liabilities assumed, and intangible assets identified as of the acquisition

date and considered a number of factors, including valuations from independent appraisers. The fair value of total net assets VIYI acquired on September 28, 2020, was approximately USD 7.0 million (RMB 47.9 million), with the residual of the purchase price of approximately USD 8.1 million (RMB 55.5 million) was recorded as goodwill.

On July 1, 2021 VIYI acquired Shanghai Guoyu for consideration of RMB 20,000,000 (USD 3,083,850). The fair value of total net assets VIYI acquired on was approximately RMB 6.7 million with the residual of the purchase price of approximately RMB 13.3 million (USD 2.1 million) was recorded as goodwill.

VIYI records share-based compensation expense for employees by allocations from the Parent using a proportional cost allocation method by considering the headcount and its estimates of each employee’s time attributable to the Company. The share-based compensation expense are valued at fair value on the grant date. Share-based compensation is recognized net of forfeitures, as amortized expense on a straight-line basis over the requisite service period, which is the vesting period.

VIYI recorded compensation expense of RMB 3,949,066 (USD 605,230) for the year ended December 31, 2020, which we don’t have such expense for the same period in 2021

VIYI performs annual goodwill impairment analysis as of December 31 with the assistance of an independent valuation expert following the subsequent measurement provisions of FASB ASU 2017-04, Intangible — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which eliminated the calculation of implied goodwill fair value and allows VIYI to use a simpler one-step impairment test. Under ASU 2017-04, VIYI must record goodwill impairment charges if a reporting unit’s carrying value exceeds its fair value.

The reporting units’ fair values are determined by the income approach where projected future cash flows are discounted at rates commensurate with the risks involved (“Discounted Cash Flow” or “DCF” of the income approach).

Assumptions used in a DCF analysis require the exercise of significant judgment, including judgment about appropriate discount rates and terminal values, growth rates, and the amount and timing of expected future cash flows. The forecasted cash flows are based on current plans, and for years beyond that plan, the estimates are based on assumed growth rates. VIYI believes that its assumptions are consistent with the plans and estimates used to manage the underlying businesses. The discount rates, which are intended to reflect the risks inherent in future cash flow projections, used in a DCF analysis are based on estimates of the weighted-average cost of capital “WACC”) of a market participant. Such estimates are derived from VIYI’s analysis of peer companies and consider the industry weighted average return on debt and equity from a market participant perspective and adjusted for VIYI’s specific risks. The discount rate applied were 18% and 20% for VIYI’s reporting units.

VIYI has two reporting units that have goodwill. The following table categorizes VIYI’s goodwill by reporting unit as of December 31, 2021, according to the level of excess between the reporting’ unit’s fair value and carrying value.

VIYI has performed qualitative assessment for goodwill impairment as of June 30, 2022 for its segments and determined that goodwill was unlikely impaired. VIYI gave consider to the general macroeconomic condition, industry and market consideration, access to capital, cost factors and overall financial performances. Revenues from

the central processing algorithm segment for the six months ended June 30, 2022 have increased by approximately RMB 135.5 million, or 108.1%, while sale of intelligent chips revenue decreased by approximately RMB 3.2 million from RMB 86.9 million for the six months ended June 30,2021 representing a 3.7% decrease. VIYI believes that the current results of operations have been within its forecast for the valuation of the enterprise value.

VIYI adopted Accounting Standards Update (“ASU”) 2014-09 Revenue from Contracts with Customers (ASC Topic 606) for the year ended December 31, 2019, using the modified retrospective method for contracts that were not completed as of December 31, 2018. The ASU requires the use of a new five-step model to recognize revenue from customer contracts. The five-step model requires that VIYI (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) VIYI satisfies its performance obligation.

Prior to 2019, VIYI recognizes revenue when all of the following have occurred: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred, or services have been rendered, (iii) the price or fees are fixed or determinable, and (iv) the ability to collect is reasonably assured. Revenue is presented in the consolidated statements of income and comprehensive income net of sales taxes. VIYI does not offer rights of refund of previously paid or delivered amounts, rebates, rights of return, or price protection. In all instances, VIYI limits the amount of revenue recognized to the amounts for which VIYI has the right to bill its customers.

The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way VIYI records revenue. Upon adoption, VIYI evaluated its revenue recognition policy for all revenue streams within the scope of the ASU under previous standards, using the five-step model under the new guidance, and confirmed that there were no differences in the pattern of revenue recognition as all revenue were recognized at a point in time prior to adoption of the ASU.

For VIYI’s central processing algorithm advertising display services, VIYI’s performance obligation is to identify advertising spaces and embed images or videos into films, shows, and short-form videos that are hosted by online streaming platforms in China. Revenue is recognized at a point in time when the related services have been delivered based on the specific terms of the contract, which are commonly based on a specific action (i.e., cost per impression (“CPM”) for online display.

VIYI enters into advertising contracts with advertisers where the amounts charged per specific action are fixed and determinable, the specific terms of the contracts were agreed on by VIYI, the advertisers, and channel providers, and collectability is probable. Revenue is recognized on a CPM basis as impressions.

VIYI considers itself as the provider of the services as VIYI has control of the specified services and products at any time before they are transferred to the customers, which is evidenced by (1) VIYI is primarily responsible to VIYI’s customers for products and services offered where the products were designed in house and VIYI has customer services team to directly serve the customers; and (2) VIYI has latitude in establishing pricing. Therefore, VIYI acts as the principal of these arrangements and reports revenue earned and costs incurred related to these transactions on a gross basis.

VIYI provides central processing algorithm performance-based advertising services for its customers, which enable the customers to get the optimal business opportunities.

VIYI’s performance obligation is to help customers to accurately match consumers and traffic users, and thereby increasing the conversion rate of product sale using its proprietary data optimization algorithms. Related service fees are generally billed monthly, based on a per transaction basis.

VIYI considers itself as provider of the services as it has control of the specified services and products at any time before it is transferred to the customers which is evidenced by (1) it is primarily responsible to its customers for the services offered where the algorithms and data optimization were designed and performed in house and it has customer services team to directly serve the customers; and (2) having latitude in establish pricing. Therefore VIYI acts as the principal of these arrangements and reports revenue earned and costs incurred related to these transactions on a gross basis.

In addition, through VIY’s data algorithm optimization, it is able to identify certain end user needs and it facilitates certain value added services to the end users. VIYI engages third party services provider to perform the services. VIYI concludes that it does not control the services as the third party service provider is responsible for providing the service and its responsibility is merely to facilitate the provision of these value added service to the end users and charges a fee. As such VIYI recorded revenue from the value added services on a net basis when the services is provided by third party service provider.

VIYI generates revenue from jointly operated internet games publishing services and licensed out games. In accordance with ASC 606, Revenue Recognition: Principal Agent Considerations, VIYI evaluates agreements with the game developers, distribution channels, and payment channels in order to determine whether or not VIYI acts as the principal or as an agent in the arrangement with each party, respectively. The determination of whether to record the revenues, gross or net, is based on whether VIYI promised its customers to provide products or services or to facilitate a sale by a third party. The nature of the promise depends on whether VIYI controls the products or services prior to transferring them to VIYI’s customers. Control is evidenced if VIYI was primarily responsible for fulling the provision of services and had discretion in establishing the selling price. When VIYI controls the products or services, VIYI’s promise is to provide and deliver the products, and revenue is presented on a gross basis. When VIYI does not control the products, VIYI’s promise is to facilitate the sale, and VIYI presents the revenue on a net basis.

VIYI offers publishing services for internet games developed by third-party game developers. VIYI acts as a distribution channel that publishes the games on VIYI’s own app or a third-party-owned app or website, named game portals. Through these game portals, game players can download the internet games to their mobile devices and purchase coins, the virtual currency, for in-game premium features to enhance their game playing experience. VIYI enters into contracts with third-party payment platforms for collection services offered to game players who have purchased coins. The third-party game developers, third-party payment platforms, and co-publishers are entitled to profit-sharing based on a prescribed percentage of the gross amount charged to the game players. VIYI’s obligation in the publishing services is completed at a point in time when the game players make a payment to purchase coins.

With respect to the publishing services arrangements between VIYI and the game developer, VIYI considered that it does not control the services, as (i) developers are responsible for providing the game product desired by the game players; (ii) the hosting and maintenance of game servers for running the online internet games are the responsibilities of the third-party platforms; and (iii) the developers or third party platforms have the right to change the pricing of in-game virtual items. VIYI’s responsibilities are publishing, providing payment solutions, and market promotion services, and thus VIYI views the game developers as VIYI’s customers and considers itself as the facilitator of the game developers in the arrangements with game players. Accordingly, VIYI records the game publishing service revenue from these games, net of amounts paid to the game developers.

VIYI also licenses third parties to operate VIYI’s internet games developed internally through the mobile portal and receive revenue from the third-party licensee operators on a monthly basis. VIYI’s performance obligation is to provide internet games to game operators, which enable players of the internet games to make in-game purchases, and VIYI recognizes revenue at a point in time when game players complete the purchases. VIYI records revenues on a net basis, as VIYI does not have control of the services provided, nor does VIYI have the primary responsibility for fulfillment or the right to change the pricing of the game services.

Starting in September 2020, VIYI has also been engaged in the resale of chips and intelligent chips products and accessories. VIYI typically enters into written contracts with its customers where the parties’ rights, including payment terms, are identified, and sales prices to VIYI’s customers are fixed with no separate sales rebate, discount, or other incentives, and no right of return exists on sales of inventory. VIYI’s performance obligation is to deliver products according to contract specifications. VIYI recognizes gross product revenue at a point in time when the control of products or services is transferred to customers.

To distinguish a promise to provide products from a promise to facilitate the sale from a third party, VIYI considers the guidance of control in ASC 606-10-55-37A and the indicators in 606-10-55-39. VIYI considers this guidance in conjunction with the terms in VIYI’s arrangements with both suppliers and customers.

In general, VIYI controls the products as VIYI has an obligation to (i) fulfill delivery of products and (ii) bear any inventory risk as legal owners. In addition, when establishing the selling prices for delivery of the resale products, VIYI has control to set its selling price to ensure it would generate profit for the product delivery arrangements. VIYI believes that all these factors indicate that VIYI is acting as a principal in this transaction. As a result, revenue from the trading of products is presented on a gross basis.

VIYI also designs software for central processing units based on customers’ specific needs. The contract is typically fixed priced and does not provide any post-contract customer support or upgrades. VIYI’s performance obligation is to design, develop, test, and install the related software for customers, all of which are considered one performance obligation as the customers do not obtain benefits for each separate service. The duration of the development period is short, usually less than one year.

VIYI’s revenue from software development contracts is generally recognized over time during the development period, and VIYI has no alternative use of the customized software and application without incurring significant additional costs. Revenue is recognized based on VIYI’s measurement of progress towards completion based on output methods when VIYI could appropriately measure the customization progress towards completion by reaching certain milestones specified in contracts. Assumptions, risks, and uncertainties inherent in the estimates used to measure progress could affect the amount of revenues, receivables, and deferred revenues at each reporting period.

VIYI records receivable related to revenue when VIYI has an unconditional right to invoice and receive payment. Payments received from customers before all of the relevant criteria for revenue recognition are met recorded as deferred revenues.

Accounts receivable include trade accounts due from customers. Accounts are considered overdue after 90 days. Management reviews VIYI’s receivables on a regular basis to determine if the bad debt allowance is adequate and provides allowance when necessary. The allowance is based on management’s best estimates of specific losses on individual customer exposures, as well as the historical trends of collections. Account balances are charged off against the allowance after all means of collection have been exhausted, and the likelihood of collection is not probable.

VIYI’s intangible assets with definite useful lives primarily consist of copyrights, non-compete agreements, and technology know-how. Identifiable intangible assets resulting from the acquisitions of subsidiaries accounted for using the purchase method of accounting are estimated by management based on the fair value of assets received. VIYI amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment. VIYI typically amortizes its intangible assets with definite useful lives on a straight-line basis over the shorter of the contractual terms or the estimated useful lives. The estimate useful lives are as follows:

Cost allocation include allocation of certain general and administrative and financial expenses paid by the Parent. General and administrative expenses consist primarily share-based compensation expense, salary and related expenses of senior management and VIYI employees, shared management expenses, including accounting, consulting, legal support services, and other expenses to provide operating support to the related businesses. Allocated financial expense was mainly amortization of debt discount related to Shenzhen Yitian’s acquisition payable. These allocations are made using a proportional cost allocation method by considering the proportion of revenues, headcounts as well as estimates of time spent on the provision of services attributable to the Company and the related expenses resulted from the acquisition of subsidiary.

VIYI accounts for current income taxes in accordance with the laws of the relevant tax authorities. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred taxes are accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized, or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities.

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely to be realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. No penalties and interest incurred related to underpayment of income tax are classified as income tax expenses in the period incurred. PRC tax returns filed from 2018 to 2020 are subject to examination by any applicable tax authorities.

VIYI determines if a contract contains a lease at inception. VIYI GAAP requires that VIYI’s leases be evaluated and classified as operating or finance leases for financial reporting purposes. The classification evaluation begins at the commencement date, and the lease term used in the evaluation includes the non-cancellable period for which VIYI has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which results in an economic penalty. All of VIYI’s real estate leases are classified as operating leases.

VIYI has entered into seven non-cancellable operating lease agreements for seven office spaces expiring through December 2022. Upon adoption of FASB ASU 2016-02, VIYI recognized approximately RMB 1.6 million right of use (“ROU”) assets and the same amount of lease liabilities based on the present value of the future minimum rental payments of leases, using a weighted average discount rate of 7% based on the duration of lease terms. VIYI’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases generally do not contain options to extend at the time of expiration, and the weighted average remaining lease terms are 1.5 years. Operating lease expenses are allocated between the cost of revenue and selling, general, and administrative expenses.

For a detailed discussion on recent accounting pronouncements, see Note 2 to the consolidated financial statements included elsewhere in this proxy statement.

As of June 30, 2022, VIYI had cash and cash equivalents and short term investment of approximately RMB 302.5 million (USD 45.1 million). Material amounts of cash disaggregated by currency denomination as of June 30, 2022 in each jurisdiction in which VIYI’s subsidiaries or VIE are domiciled are as follows:

VIYI’s working capital was approximately RMB 219.6 million (USD 32.7 million) as of June 30, 2022. In assessing VIYI’s liquidity, VIYI monitors and analyses its cash-on-hand and operating and capital expenditure commitments. To date, VIYI has financed VIYI’s working capital requirements through cash flow generated from operations, debt and equity financings, and capital contributions from VIYI’s existing shareholders.

VIYI believes its current working capital is sufficient to support VIYI’s operations for the next twelve months. VIYI may, however, need additional cash resources in the future if it experiences changes in business conditions or other developments or if VIYI finds and wishes to pursue opportunities for investment, acquisition, capital expenditure, or similar actions. If VIYI determines that its cash requirements exceed the amount of cash and cash equivalents VIYI has on hand at the time, VIYI may seek to issue equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to VIYI’s shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict VIYI’s operations. VIYI’s obligation to bear credit risk for certain financing transactions VIYI facilitates may also strain VIYI’s operating cash flow. VIYI cannot assure you that financing will be available in amounts or on terms acceptable to VIYI, if at all.

Current foreign exchange and other regulations in the PRC may restrict VIYI’s PRC entities in their ability to transfer their net assets to VIYI and its subsidiaries in Singapore and Hong Kong and to VIYI’s investors. The PRC government imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. Under VIYI’s current corporate structure, VIYI’s Cayman Islands holding company may rely on dividend payments from VIYI’s PRC subsidiaries to fund any cash and financing requirements VIYI may have. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of SAFE by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations of VIYI’s PRC subsidiaries in China may be used to pay dividends to VIYI. However, approval from or registration with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, VIYI needs to obtain SAFE approval to use cash generated from the operations of VIYI’s PRC subsidiaries to pay off their respective debt in a currency other than Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than Renminbi.

However, these restrictions have no material impact on the ability of these PRC subsidiaries to transfer funds to VIYI as VIYI has no present plans to declare dividends which it plans to retain VIYI’s retained earnings to continue to grow VIYI’s business. In addition, these restrictions have no material impact on the ability of VIYI to meet its cash obligations, as a majority of VIYI’s current cash obligations are due within the PRC.

To utilize the proceeds VIYI received from this this offering, VIYI plans to use (i) approximately 40% of the net proceeds for operating expenses and the research and development of the application of cloud computing, artificial intelligence, big data, 5G, 3D and other technological fields, (ii) approximately 30% of the net proceeds for strategic acquisitions and investments in complementary business, and (iii) approximately 30% of the net proceeds for other general corporate purposes, including working capital, operating expenses, and capital expenditures.

If an unforeseen event occurs or business conditions change, VIYI may use the proceeds of this offering differently than as described in this proxy statement. In utilizing the proceeds from this offering, VIYI is permitted under PRC laws and regulations to provide funding to VIYI’s PRC subsidiaries only through loans or capital contributions, and only if VIYI satisfies the applicable government registration and approval requirements. The relevant filing and registration processes for capital contributions typically take approximately eight weeks to complete. The filing and registration processes for loans typically take approximately four weeks or longer to complete. While VIYI currently anticipates no material obstacles to completing the filing and registration procedures with respect to future capital contributions and loans to VIYI’s PRC subsidiaries, VIYI cannot assure you that it will be able to complete these filings and registrations on a timely basis, or at all. Additionally, while there is no statutory limit on the amount of capital contribution that VIYI can make to VIYI’s PRC subsidiaries, loans provided to VIYI’s PRC subsidiaries in the PRC are subject to certain statutory limits. See “Risk Factors — Risks Related to Doing Business in China — PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent VIYI from using the proceeds of this offering to make loans or make additional capital contributions to VIYI’s PRC subsidiaries, which could materially and adversely affect VIYI’s liquidity and its ability to fund and expand VIYI’s business.” VIYI expects the net proceeds from this offering to be used in the PRC will be in the form of RMB and, therefore, VIYI’s PRC subsidiary will need to convert any capital contributions or loans from U.S. dollars into Renminbi in accordance with applicable PRC laws and regulations.

The following table summarizes the key components of VIYI’s cash flows for the years ended December 31, 2020, and 2021, and six months ended June 30, 2021, and 2022.

Net cash provided by operating activities for the six months ended June 30, 2022, was primarily attributable to net income of approximately RMB 15.2 million (USD 2.3 million) increased by various non-cash expenses of approximately RMB 3.6 million (USD 0.5 million). Cash inflow was also attributable to the increase of deferred revenue of approximately RMB 2.4 million (USD 0.4 million) and decrease in inventory of approximately 3.3 million (USD 0.5 million) as the resurgences of COVID-19 variant have reduced VIYI’s inventory purchase and VIYI has to use more existing inventory. The inflow was offset by increase in accounts receivable of RMB 15.8 million (USD 2.4 million) as VIYI’s revenue increased, increase in prepaid service fee of approximately RMB 4.3 million (USD 0.6 million) to secure channel costs, and decrease in accounts payable of approximately RMB 2.3 million (USD 0.3 million) due to less inventory purchased by VIYI as mentioned above.

Net cash provided by operating activities for the year ended December 31, 2021, was primarily attributable to net income of approximately RMB 54.7 million (USD 8.6 million) increased by non-cash depreciation and amortization expenses of approximately RMB 9.6 million (USD 1.5 million), goodwill impairment loss of approximately RMB 18.5 million (USD 2.9 million), and provision for doubtful accounts of approximately RMB 1.4 million (USD 0.2 million) offset with deferred tax benefit of approximately RMB 1.8 million (USD 0.3 million) and change in fair value of business acquisition payable of approximately RMB 3.2 million (USD 0.5 million). Cash inflow was also attributable to the increase deferred revenue of approximately RMB 6.7 million (USD 1.1 million) and decrease in accounts receivable of approximately RMB 32.5 million (USD 5.1 million) as VIYI made more efforts in the collection and demanded more advance payment from new customers.

Cash inflow was partially offset by the increase in prepaid service fees of approximately RMB 15.5 million (USD 2.4 million) as VIYI paid more advance service fees to secure advertising channels and VIYI paid approximately RMB 4.1 million (USD 0.6 million) of inventory for its chip sales.

Net cash provided by operating activities for the year ended December 31, 2020, was primarily attributable to net income of approximately RMB 91.5 million (USD 14.0 million), non-cash depreciation and amortization expenses of approximately RMB 4.8 million (USD 0.7 million), share-based compensation expense of approximately RMB 3.9 million (USD 0.6 million), and amortization of debt discount of approximately RMB 0.9 million (USD 0.1 million) which was partially offset by deferred tax benefit of approximately RMB 1.0 million (USD 0.2 million). Cash inflow was also attributable to the increase in inventories of approximately 1.4 million (USD 0.2 million), increase in deferred revenues of approximately RMB 4.1 million (USD 0.6 million) as VIYI required new customers to pay in advance and increase in other payables of approximately RMB 1.2 million

(USD 0.2 million). Cash inflow was partially offset by the increase in prepaid expenses and other current assets of approximately RMB 3.2 million (USD 0.5 million), as VIYI prepaid more professional fees and VIYI made more advances to secure advertising channels for advertising and the increase in accounts receivable of approximately RMB 7.8 million (USD 1.2 million) along with VIYI’s increase in revenue.

Cash used in investing activities for the six months ended June 30, 2022 mainly due to net purchase and sale of short term investment of approximately RMB 1.1 million (USD 0.2 million), purchase of property and equipment of approximately RMB 1.2 million (USD 0.2 million), purchase of cost method investment of approximately RMB 0.6 million (USD 0.1 million), and collection of loans receivable approximately RMB 21.2 million (USD 3.2 million).

Cash used in investing activities for the year ended December 31, 2021 as mainly due to the payment of Guoyu’s acquisition of approximately RMB 20.0 million (USD 3.1 million), and loan to a third party of approximately RMB 21.2 million (USD 3.3 million).

Cash provided by investing activities for the year ended December 31, 2020, was mainly due to the repayments from the Parent of approximately RMB 231.1 million (USD 35.4 million). Cash inflow was partially offset by the net acquisition payments on Fe-da Electronics of approximately RMB 95.5 million (USD 14.6 million) and advances to the Parent of approximately RMB 101.7 million (USD 15.6 million).

Cash provided by financing activities for the six months ended June 30, 2022 was mainly due to net borrowing and repayments from Parent of approximately RMB 4.3 RMB (USD 0.6 million) to support VIYI’s daily operation. VIYI also paid deferred merger cost of approximately RMB 0.1 million (USD 20,000).

Cash used in financing activities for year ended December 31, 2021 was mainly due to the net borrowing and repayment of the banking facility to DBS Bank Ltd of approximately RMB 12.9 million (USD 2.0 million), and net borrowing and repayments from Parent of approximately RMB 8.3 million (USD 1.3 million) to support VIYI’s daily operation. VIYI also paid deferred merger cost of approximately RMB 3.8 million (USD 0.6 million). For the year ended December 31, 2021, Shanghai Weimu borrowed total of RMB 5,616,145 from Gou Lei, noncontrolling shareholder of Shanghai Weimu, for operation purpose and repaid all outstanding balance in 2021.

Cash provided by financing activities for the year ended December 31, 2020, was mainly the proceeds from the Parent of approximately RMB 102.8 million (USD 15.8 million) to support VIYI’s daily operation, capital contribution from shareholders and noncontrolling interests of approximately RMB 10.2 million (USD 1.6 million) and proceeds of approximately RMB 16.1 million (USD 2.5 million) from DBS Bank Ltd. which VIYI borrowed in 2020 for inventory purchase. Cash inflow was partially offset by the repayment of approximately RMB 16.1 million (USD 2.5 million) to DBS Bank Ltd. which VIYI borrowed in 2020.

VIYI operates in two segments, CPA and intelligent chips and software services. For intelligent chips and software services segment, it is mainly operated by VIYI holding and subsidiaries in Singapore, Fe-da Electronics. Both VIYI and Fe-da Electronics has its own operating cashflow from operation of the segment. VIYI and Fe-da had intercompany transfers in cash of approximately RMB 7.8 million December 31, 2020. VIYI and VIYI Ltd had intercompany transfers in cash of approximately RMB 16.0 million for the year ended December 31, 2021. The CPA segment is mainly operated by subsidiaries in the PRC, each entity has its own operating cash flow. For the six months ended June 30, 2022, there was approximately RMB 9.3 million from the holding company to the PRC subsidiary. For further details, please refer to page 28 to 31 “Summary Financial Information of VIYI”. There was no dividends or distribution made between VIYI, its subsidiaries and the historical VIE. VIYI has established controls and procedures for cash flows within its organization. Each transfer of cash between Cayman Islands holding company and a subsidiary, the VIE is subject to internal approval. In general cash is maintained in holding company level (VIYI for companies outside PRC and VIYI WFOE for entities inside PRC) for more efficient cash management.

VIYI has no present plans to distribute earnings, it plans to retain VIYI’s retained earnings to continue to grow VIYI’s business. No dividends or distribution has been declared to paid to VIYI from subsidiaries and no dividends or distribution was made to any U.S. investors.

In the normal course of business, VIYI is subject to loss contingencies, such as legal proceedings and claims arising out of its business, that cover a wide range of matters, including, among others, government investigations and tax matters. In accordance with ASC No. 450-20, “Loss Contingencies”, VIYI will record accruals for such loss contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated.

VIYI has no off-balance sheet arrangements, including arrangements that would affect VIYI’s liquidity, capital resources, market risk support, and credit risk support, or other benefits.

As of June 30, 2022, the future minimum payments under certain of VIYI’s contractual obligations were as follows:

Inflationary factors, such as increases in personnel and overhead costs, could impair VIYI’s operating results. Although VIYI does not believe that inflation has had a material impact on VIYI’s financial position or results of operations to date, a high rate of inflation in the future may have an adverse effect on VIYI’s ability to maintain current levels of gross margin and operating expenses as a percentage of sales revenue if the revenues do not increase with such increased costs.

VIYI is exposed to interest rate risk while it has short-term banking facilities outstanding. Although interest rates for VIYI’s short-term loans are about fixed for the terms of the loans, the terms are typically twelve (12) months, and interest rates are subject to change upon renewal.

VIYI is also exposed to liquidity risk, which is a risk that VIYI will be unable to provide sufficient capital resources and liquidity to meet VIYI’s commitments and business needs. Liquidity risk is controlled by the application of financial position analysis and monitoring procedures. When necessary, VIYI will turn to other financial institutions and related parties to obtain short-term funding to cover any liquidity shortage.

While VIYI’s reporting currency is the RMB, one of VIYI’s operating entity’s functional currency is the HK dollar, and another one’s operating entity’s functional currency is USD. As a result, VIYI is exposed to foreign exchange risk as VIYI’s results of operations may be affected by fluctuations in the exchange rate among HK dollar, USD, and RMB. If the RMB appreciates against the HK dollar and USD, the value of VIYI’s HKD or USD revenues, earnings, and assets as expressed in VIYI’s RMB financial statements will decline. VIYI has not entered into any hedging transactions in an effort to reduce VIYI’s exposure to foreign exchange risk.

The central processing algorithm service is a service based on a series of algorithms including analytical algorithms, recommendation algorithms and acceleration algorithms, which can empower downstream industries with higher demand for data analysis and computing power optimization, and apply to internet advertising, internet game applications, finance, retail, logistics and other industries. In view of huge downstream demands, the overall market of central processing algorithm services is huge. Major players in the central processing algorithm service industry include digital marketing service providers, online game service providers and algorithm solution service providers.

With the rapid development of the computer industry and the internet industry and the increase of internet penetration rate in China, the number of internet users and internet data in China have increased significantly. The internet industry is the largest application industry for central processing algorithm services, and internet applications’ demand for computing power are increasing.

According to the CIC Report, most internet users in China use mobile phones as their primary terminal. The number of mobile internet users grew strongly from 619.8 million in 2015 to 880.9 million in 2019, representing a CAGR of 5.2%.

In 2019, the average time spent by China’s mobile internet users on apps reached 328 minutes/day, of which the time spent on mobile games was over 21 minutes/day, and the time spent by internet users on mobile apps in the future will be over 370 minutes/day. With the popularity of smartphones and the continuous addition of various apps, an enormous amount of data is generated. According to the CIC Report, in 2019, the global internet data volume reached 41ZB and the PRC internet data volume reached 9.9ZB, and it is expected that by 2025, the world internet data volume will reach 175ZB and the PRC internet data volume will reach 48.6ZB. Large-scale data requires the support of better algorithms and computing power, and the market demand for central processing algorithm services is also continuously developing driven by the development of the internet and the demand for bigdata.

The main purpose of the central processing algorithm service is to achieve intelligent management of data (data collection, analysis, classification, matching, etc.) and optimize the allocation of resources. Sensors and chips are the fundamental equipment for realizing “data + computing power + algorithm”, while algorithm technology is the technical support for the development of big data, cloud computing and IoT. Currently, VIYI’s central processing algorithm services mainly focus on the industry application in the fields of internet advertising distribution solutions and online game agent solutions.

According to the CIC Report, with the rapid growth of the demand for computing power and algorithm optimization services in the internet advertisement and online game industry, the scale of central processing algorithm application in these two industries has reached a CAGR of 32.7% in the past five years and will continue to grow rapidly. The application scale of central processing algorithms reached RMB 6.9 billion in 2020 and is expected to reach RMB 13.8 billion by 2025.

Market Development and Application of Central Processing Algorithms in Internet Advertising industry

Since the 20^thcentury, the global commodity economy has experienced a prosperous development, the scale of economy has grown rapidly, and the advertising industry has entered into a period of rapid development. During this period, with the research and development and application of science and technology, electronic products such as radio, television, computer and mobile terminals have been rapidly popularized, and the media forms have shown a trend of diversity, and the contents of advertisements have also become more diversified. In the context of diversified dissemination channels of marketing information, single marketing communication means is difficult to meet all marketing needs of advertisers, and advertisers tend to use multiple media portfolios to carry out multi-scenario marketing communication, which further promotes the development of the advertising industry. In recent years, the internet especially mobile internet has developed rapidly, and new internet media such as video websites and social media with higher information dissemination efficiency and wider coverage have emerged. As a result, internet media has gradually developed into a form of mainstream media, and the market size of digital marketing has surpassed the market size of traditional media such as television, newspaper, and outdoor advertising, showing a trend of rapid growth. However, there are significant differences in the contents and forms of dissemination among different media, and significant differences exist in the image of the corresponding marketing audience. With the continuous transformation of popular media formats, advertisers are increasingly difficult to capture the characteristics of these media and their marketing audience, and advertisers increasingly require the provision of more professional integrated marketing services to improve the efficiency of marketing information dissemination. Compared with traditional media, internet media has the advantages and characteristics of the information being storable, retrievable and measurable, which can get closer to the marketing audience and create stronger interaction with the marketing audience, providing them with a more convenient channel for the marketing communication information to be delivered.

With the advancement of technology, the internet, especially the mobile internet which has been rapidly popularized, and new media such as video, have emerged one after another. Compared to traditional web portal-based internet media, emerging internet media are able to disseminate more rich and lively marketing information to the audience in innovative forms such as content distribution, which attracts the attention of the marketing audience and makes it easier for them to participate in the dissemination chain of internet marketing. The emerging new media provides advertisers with diversified marketing information dissemination channels, which is conducive to stimulating advertisers’ demand for advertising placement and further driving the continuous growth of the advertising industry.

According to the CIC Report, the market size of the overall advertising industry in China has been growing at a CAGR of 9.8% from 2015 to 2019, reaching RMB 867.4 billion in 2019 and is expected to reach RMB 1,762.5 billion in 2024.

In particular, the advertising placement volume of digital marketing has increased rapidly, which gradually seized the market share of offline marketing. From 2015 to 2019, it experienced rapid growth at a CAGR of 32.1%, and its market share in the overall advertising industry increased from 36.6% in 2015 to 76.8% in 2019, and is expected to further increase to 87.7% by 2024. In 2019, the market size of digital marketing reached RMB 665.8 billion, and is expected to reach RMB 1,545.5 billion by 2024.

Digital marketing advertising includes two categories, namely brand-based advertising and performance- based advertising. Performance-based advertising has historically experienced fast growth as enterprises become more and more concerned about the measurable advertising results. During 2015 to 2019, it grew rapidly at a CAGR of 33.5% and is expected to continue growing at a CAGR of 20.5%. Its market share in digital marketing advertising is expected to reach 88.6% by 2024.

Compared with offline marketing, digital marketing allows upstream customers to monitor the performance of marketing activities more easily and improve marketing efficiency. Digital marketing provides multiple pricing models, which makes marketing more flexible and efficient, and also has the ability to provide and access to various user behavioral information that can be collected, providing upstream enterprises with better user analysis and more precise marketing execution.

The upstream of the digital marketing industry chain are advertisers, the midstream are advertising agencies, digital marketing technology companies and other digital marketing solution providers, and the downstream are media platforms. The digital marketing technology company acts as an intermediary for advertisers/advertising agencies to allocate marketing budget and purchase media spaces from internet platform partners. Many of

the services provided by digital marketing technology companies are programmed advertising, as well as other value-added services such as data analysis, dynamic and creative optimization, and other services in the marketing value chain including creative and strategic aspects. The midstream digital marketing solution providers operating in the market include a wide range of suppliers, including advertising agencies, digital marketing technology companies, and solution providers focusing on advertising performance measurement, data analysis, etc.

Digital marketing technology providers provide advertisers and agencies with comprehensive integrated marketing solutions based on central processing algorithms and self-built demand side platforms (DSP), including digital marketing solutions such as programmatic advertising, data management and dynamic and creative optimization. DSP is a system that allows buyers of digital advertising inventories to manage multiple advertising exchange and data exchange accounts through an interface. Digital marketing technology providers are mainly divided into third-party digital marketing technology providers and in-house digital marketing technology platforms built by media platforms.

The development of central processing algorithms makes it increasingly easier for a quick collection and process of large amounts of user data. Digital marketing solution providers are able to access and analyses user data to conduct precise marketing, including one-stop management capabilities such as matching users for industry customers, personalized recommendation and business monetization, and high quality engineering structure assurance system with low latency and high scalability, thereby generating valuable insights into consumer behavior. Leveraging its powerful real-time transcoding and distribution capabilities, the digital marketing service provider provides a series of services with stable and smooth flow, low latency and high concurrent support, and improves its competitiveness in the industry. Supporting resources management, scheduling management, direct placement of advertisements, and complex strategic settings can also effectively improve traffic monetization efficiency and maximize traffic value while taking care of user experience.

Digital marketing technology providers also provide many additional value-added services to upstream advertisers/advertising agencies, including advertising strategies, data analysis, dynamic and creative optimization, etc. Digital marketing technology providers have achieved omni-channel penetration to cater for the trend of information fragmentation, which enables precise quantification of advertisements, saving advertising costs for upstream enterprises and providing better investment return for advertisers. Compared with traditional internet advertising distribution, the internet advertising distribution solution business provided by the central processing algorithms has expanded the advertising traffic on online platforms and enhanced the user experience of the display of advertisements, resulting in a trend of rapid growth in market acceptance.

VIYI provides internet advertising integrated agencies with central processing algorithm services. Through optimizing advertising content and content matching, and applying central processing algorithms, VIYI distributes advertisements through internet multimedia platforms, and carryout targeted advertising placement according to different categories such as the age, gender and preference of the target audience, so as to reach the target audience at the terminal efficiently.

Market Development and Application of Central Processing Algorithms in Online Game Industry

The online game industry in China is developing rapidly. Over the past decade, the continuous rising levels of average disposable income and consumers’ purchasing power in China have led to an increase in consumer sentiment for online entertainment, which has continuously stimulated the growth of the industry. Online games can be mainly divided into three categories based on different platforms, namely online PC games, web games and mobile games. Driven by the increasing penetration rate of internet and mobile devices, China’s online game industry, especially the mobile game industry, has experienced significant growth in the past few years.

The penetration rate of smartphones is continuously increasing, and smartphones are bringing users with higher quality game resolution, sound effects and control, which drives the development of China’s mobile game industry. Game users are increasingly accustomed to paying for online games including mobile games, and online consumption patterns have promoted game spending more frequently. In addition, the cloud gaming revolution and the rapid development of VR/AR industries have further stimulated the reform and development of the online game industry.

Online game solution service providers, based on central processing algorithms, provide integrated services such as game application acceleration and game agent distribution. Relying on the rapid development of China’s online game industry, online game solution services based on central processing algorithms are also developing quickly.

According to the CIC Report, the online game industry in China has experienced rapid growth. From 2010 to 2020, the continuous increasing average disposable income and purchasing power level of Chinese residents have stimulated the growth of the online entertainment industry. With the popularity of mobile terminals, the development of hardware devices and the continuous increase in the average time spent per capita, a solid foundation for the development of the game market has been laid. The number of smartphone installations has increased significantly over the past few years; in 2019, this figure in China increased to 1,410.4 million. Meanwhile, with the improvement of cellular network technology and smartphone performance, smartphone users in China spent much more time on mobile internet from 2015 to 2019. It is expected that the daily time spent will reach 419.2 minutes by 2024.

According to the CIC Report, China’s online game industry, the mobile game industry in particular, has experienced significant growth driven by the increasing penetration rate of internet and mobile devices. The number of mobile game players in China increased from 455 million in 2015 to 620 million in 2019, representing a CAGR of 8.0%. Meanwhile, the time spent by mobile users on games is expected to grow at a CAGR of 7.0% from 2019 and is expected to reach 30 minutes per day by 2024.

The market size of China’s online game industry refers to the sales revenue of the overall game market, including mobile games, PC games and web games. The industry chain of online games in China is gradually evolving to form a new integrated business model.

China’s online game industry has shown continuous expansion in the past five years. In 2019, China’s online game industry grew by 6.3%, with a total market size of RMB 275.5 billion, showing a good development momentum. Benefiting from the increase in copyright protection and consumer awareness, the mobile game industry in China is expected to maintain a healthy and stable development trend in the next five years.

The mobile game industry is a leading player in the mass gaming entertainment consumption. The market size of mobile games accounted for a continuously increasing proportion in the overall scale of China’s game industry, which has surpassed traditional PC games and web games and ranked first with a proportion of 73.9%.

Market Development and Application of Central Processing Algorithms in Chip Industry

Chip is one of the iconic products of the information age. More and more intelligent products and functions in production activities cannot be realized without the support of chip products. With the rapid development of internet and big data, as well as driven by the demand from the fields of emerging industries and applications such as artificial intelligence, cloud computing and IoT, the chip industry has maintained a rapid growth.

In recent years, the global electronics industry has experienced tremendous growth under broad application demand, product diversification trends and industry segmentation. According to the CIC Report, the chip industry has become increasingly mature since the 21^stcentury with the increasing market penetration of consumer electronic products such as personal computers, mobile phones and LCD TVs. Since 2017, driven by the demand from the fields of emerging industries and applications such as smartphones, IoT, artificial intelligence, cloud computing, intelligent medicine and security, the global chip industry has an accelerated growth. The size of global chip market increased from US$ 274.5 billion in 2015 to US$ 333.4 billion in 2019. And due to stable downstream demand, it is expected to maintain a CAGR of 7.5%, reaching US$ 515.7 billion by 2025. According to the CIC Report, the global CPU shipments increased from 814 billion in 2015 to 967 billion in 2019, representing a CAGR of 4.4%.

Various application scenarios of artificial intelligence, from cloud to edge, or down to terminal, are inseparable from the highly effective support of intelligent chips for “training” and “inferring” of computing tasks. The demand for diversification of the industry and corporate planning and competition will promote the rapid development of the entire intelligent chip industry in the next few years.

The industry applications of intelligent chips are broad, ranging from, but not limited to, information infrastructure services, electronic products manufacturing, image recognition, voice recognition, machine translation, smart IoT and other smart applications. The intelligent chip optimization solution based on the central processing algorithms can design and optimize its smart application for the demand side, and can continuously optimize the performance efficiency ratio of data processing, which maximize the matching between its intelligent chip hardware and smart application software, thereby improving the application efficiency of the intelligent chips.

At present, the development of artificial intelligence is in the third wave. The key feature of this wave is the gradual implementation of artificial intelligence application scenarios closely linked with businesses, and enterprises with advanced algorithms and strong computing capabilities become the most important promoters. The intelligent chip optimization solutions of central processing algorithms will be widely applied and developed in the artificial intelligence industry that require large amount of data processing and analysis, such as smart city, smart manufacturing, smart building, smart community, smart healthcare, smart transportation and other application fields.

According to the CIC Report, benefiting from the development of IoT, cloud computing technology and the increasing government investment, China’s artificial intelligence market size is in the process of speedy expansion, and it is expected that the scale of core industries will reach RMB 400 billion by 2025, with an increase of RMB 350 billion from 2020 to 2025. The development of artificial intelligence market will drive the development of the central processing algorithm intelligent chip optimization solution industry.

According to the “Notice on the Development Plan for New Generation of Artificial Intelligence” issued by the State Council, by 2020, the AI technology and application will be synchronized with the global standard. The scale of core industries will reach RMB 150 billion, and the scale of related industries will exceed RMB 1 trillion; by 2025, AI will be widely used in industries such as smart cities, smart healthcare and smart agriculture, with an expected industrial scale reaching RMB 400 billion and the scale of operation of related industries exceeding RMB 5 trillion; and by 2030, a complete AI industrial chain and high-end industrial groups will form, with the core industries achieving a scale of RMB 1 trillion and the production value of related industries exceeding RMB 10 trillion.

In the future, IoT will provide more data collection terminals, which greatly enhances the data volume; big data provides information sources for artificial intelligence, cloud computing provides a physical carrier for artificial intelligence, and 5G reduces the latency of data transmission and processing. Driven by emerging technologies, the demand for chips continues to grow.

Major players in the central processing algorithm service industry include digital marketing service providers and online game service providers. VIYI is a leading enterprise in providing comprehensive services in the industry.

VIYI’s central processing algorithm service provides a comprehensive digital marketing solution for internet advertising agency integrators, and enhances advertising conversion rate and advertising placement efficiency through programmatic advertising, data management and dynamic optimization. VIYI’s central processing algorithm service promotes the marketing conversion rate of game products, and significantly improves the experience of online game users through services such as game acceleration, so as to reduce the cost of game user acquisition, and increase user retention and willingness to pay.

In China, the competition among the central processing algorithm service providers is fierce in the online application digital marketing and acceleration industry, with the top 5 central processing algorithm service providers accounting for approximately 40% of the total market size. It is estimated that VIYI’s market share among the central processing algorithm service providers in the online application digital marketing and acceleration industry in China was approximately 5% in 2020, ranking the forth.

VIYI has mature algorithm technology in the field of central processing algorithm services, and the relevant intellectual property rights VIYI held ranks first among its peers.

Intellectual Property Rights Ranking in The Field of Central Processing Algorithm Service

With the development of the economy and the internet industry, the global spending on IT continues to increase and the central processing algorithm service has a huge room for development in the internet industry. With the emphasis on efficient operation and refined management of algorithmic services, enterprises have increasing demands for central processing algorithms integrated solutions and high value-added services solutions. With the diversified development of the internet industry, there will be increasing needs for application scenarios of central processing algorithms. The central processing algorithm services will be applied in various industries, including advertising, games, finance, industrial internet, telecommunications, energy, logistics, urban management, biomedical, social security and leisure and entertainment.

With the rapid development of information technology and industrial informatization transformation, the data volume will maintain a considerable growth which drives the rapid growth in demand for data asset management and in turn creates a huge demand for central processing algorithm services. Big data analysis can reveal valuable insights into different application scenarios. However, the analysis of all data to improve the decision-making process is proved to be too difficult for human brain. The central processing algorithms can automatically complete the task of big data analysis. Therefore, the rapid expansion of data volume in China is expected to drive the demand for big data analysis and further increase the demand for central processing algorithms.

With the continuous development of the internet, cloud computing, IoT and smart devices, the multimedia data has shown explosive growth. Real-time and dynamic transmission among users through the network as a carrier in information such as text, image, voice and video has exceeded the limitation of their respective individual properties, and the demand for achieving cross-media interaction, intelligent search and personalized recommendation has been further released. The explosive growth of data will continue to drive the increasing demand for central processing algorithm services.

Big data services focus on application level and empower all aspects of business operations and improve operational efficiency through the management, mining and analysis of data assets of enterprises. As a result, the demand for central processing algorithm services in industries with large data volume and high data structure such as internet, finance and government services becomes the strongest.

The continuous upgrade of cloud computing, artificial intelligence, big data, 5G, 3D, VR/AR and other technological fields also promotes the continuous improvement and update of central processing algorithms. With the rapid development of the internet industry, the ecological development of data, computing power and algorithm is gradually becoming mature and continuously evolving, and many of these factors will jointly promote the speedy development of the central processing algorithm service industry.

The PRC government highly values the advancement and industrial development of internet information technology, and the new generation of internet information technology has been levelled up to the national strategy. The market outlook of the central processing algorithm industry is promising. With the gradual maturity of artificial intelligence technology, the in-depth layout of industry giants such as technology and manufacturing industry, and the continuous expansion of application scenarios, there is ample space for the central processing algorithm industry to experience a rapid growth.

In 2019, the State Council issued the 2019 Government Work Report, which mentioned “to accelerate the development of information industry, deepen the research and development and application of big data and artificial intelligence, cultivate emerging industrial groups such as new generation information technology, high-end equipment, biomedicine, new energy vehicles and new materials, expanding the digital economy.”

In August 2020, the State Council published the Several Policies on Promoting the High Quality Development of the Integrated Circuit Industry and the Software Industry in the New Period, which mentioned that great policy support will be given to the chip and software industry.

Venus is a blank check company incorporated in the Cayman Islands and incorporated for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements with, or engaging in any other similar business combination with one or more businesses or entities. Although Venus’ efforts in identifying prospective target businesses will not be limited to a particular geographic region, it intends to focus on businesses that have a connection to the Asian market. Venus believes that it will add value to these businesses primarily by providing them with access to the U.S. capital markets.

Venus has 12 months from the date of Venus’ IPO (which occurred on February 11, 2021) to consummate a prospective business combination. However, if Venus anticipates that it may not be able to consummate a business combination within 12 months, it may, by resolution of its board of directors extend the period of time to consummate a business combination up to nine times, each by an additional one month (for a total of up to 21 months to complete a business combination). In the event Venus does not consummate a business combination within 12 months from the closing of its IPO (or up to 21 months as previously described), it will cease operations and liquidate the trust account and distribute the funds included therein to the holders of its securities sold in its IPO and dissolve.

As of [●], 2021, Venus has approximately $[●] of unused net proceeds that were not deposited into the trust account to pay future general and administrative expenses. The net proceeds deposited into the trust account remain on deposit in the trust account earning interest. As of [●], 2021, there was $[●] held in the trust account (including $[●] of accrued interest which Venus can withdraw to pay taxes).

The Merger Agreement was entered into by and among Venus, Venus Merger Sub, VIYI and WiMi on June 10, 2021. Pursuant to the terms of the Merger Agreement, the Venus Merger Sub will merge with and into VIYI, with VIYI being the surviving entity and becoming a wholly owned subsidiary of Venus. Venus shall continue to be publicly listed and will change its name to “MicroAlgo Inc.” after the consummation of the Business Combination. Venus is also referred throughout this proxy statement as New Venus.

and ceased to exist, in exchange for the issue of an aggregate of approximately 39,603,961 New Venus ordinary shares, among which approximately 792,079 New Venus ordinary shares to be issued to WiMi will be held in escrow to satisfy any indemnification obligations incurred under the Merger Agreement. At the closing of the Business Combination, VIYI will become a wholly owned subsidiary of Venus. See section titled “Summary of the Proxy Statement — The Business Combination and the Merger Agreement” for more information.

Venus’ public shareholders will be provided with the opportunity to redeem all or a portion of their public shares upon the completion of a business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of a business combination, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be approximately $10.10 per public share (subject to increase of up to an additional $0.30 per public share in the event that Venus’ Sponsor elects to extend the period of time to consummate a business combination). The per-share amount Venus will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions Venus will pay to the underwriters.

Venus’ public shareholders will be entitled to receive cash for any public shares to be redeemed only if they:

In connection with the completion of its IPO, and as a condition to the completion of the IPO, Venus’ sponsor, officers and directors entered into a letter agreement with Venus, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of the Business Combination. There was no separate consideration provided by Venus to the Sponsor, its officers or directors for the agreement not to redeem the securities held by them.

If a broker, dealer, commercial bank, trust company or other nominee holds Venus Units for an individual or entity (such individual or entity, the “beneficial owner”), the beneficial owner must instruct such nominee to separate the beneficial owner’s Venus Units into their individual component parts. The beneficial owner’s nominee must send written instructions by facsimile to the transfer agent. Such written instructions must include the number of Venus Units to be separated and the nominee holding such Venus Units. The beneficial owner’s nominee must also initiate electronically, using DTC’s DWAC system, a withdrawal of the relevant Venus Units and a deposit of an equal number of Venus ordinary shares, Venus Warrants and Venus Rights. This must be completed far enough in advance to permit the nominee to exercise the beneficial owner’s redemption rights upon the separation of the Venus ordinary shares from the Venus Units. While this is typically done electronically the same business day, beneficial owners should allow at least one full business day to accomplish the separation. If beneficial owners fail to cause their Venus ordinary shares to be separated in a timely manner, they will likely not be able to exercise their redemption rights.

In seeking shareholder approval of the Business Combination, Venus’ memorandum and articles of association provides that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be

restricted from redeeming its shares with respect to more than an aggregate of 15% of the ordinary shares sold in Venus’ IPO, which Venus refers to as the “Excess Shares.” However, Venus would not be restricting shareholders’ ability to vote all of their shares (including Excess Shares) for or against the Business Combination.

Dissolution and Subsequent Liquidation of Trust Account if No Business Combination

If Venus does not complete a business combination within 12 months (or up to 21 months, as discussed below) from the closing of its IPO (completed on February 11, 2021), it will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public shares and (iii) as promptly as reasonably possible following such redemption, subject to the approval of its remaining shareholders and board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to Venus’ obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law.

In connection with Venus’ IPO and consummation of the private placement with its sponsor, Venus issued an aggregate of 4,825,000 rights to acquire an aggregate of 482,500 ordinary shares. If Venus enters into a definitive agreement for a business combination in which New Venus will be the surviving entity, each holder of a right will receive one-tenth (1/10) of one ordinary share upon consummation of the Business Combination, even if the holder of such right redeemed all ordinary shares held by him, her or it in connection with the Business Combination or an amendment to Venus’ memorandum and articles of association with respect to Venus’ pre-business combination activities. No additional consideration will be required to be paid by a holder of rights in order to receive his, her or its additional ordinary shares upon consummation of an business combination as the consideration related thereto has been included in the unit purchase price paid for by investors in Venus’ IPO. The shares issuable upon exchange of the rights will be freely tradable (except to the extent held by affiliates of Venus). Holders of rights are not entitled to any redemption of voting rights. If Venus is unable to complete an business combination within the required time period and Venus liquidates the funds held in the trust account, holders of rights will not receive any of such funds with respect to their rights, nor will they receive any distribution from Venus’ assets held outside of the trust account with respect to such rights, and the rights will expire worthless.

In connection with Venus’ IPO and consummation of the private placement with its sponsor, Venus issued an aggregate of 4,825,000 warrants to acquire an aggregate of 4,825,000 ordinary shares. The warrants purchased in Venus’ IPO have been issued in registered form under a warrant agreement between Vstock Transfer LLC, as warrant agent, and Venus. Each warrant entitles the registered holder to purchase one ordinary share at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing on the later of 12 months from the date of this proxy statement or the completion of the Business Combination. Because the warrants may only be exercised for whole numbers of shares, only an even number of warrants may be exercised at any given time. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares. This means that only an even number of warrants may be exercised at any given time by a warrant holder. The warrants will expire five years after the completion of the Business Combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.

Venus will not be obligated to deliver any ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the ordinary shares underlying the warrants is then effective and a proxy statement relating thereto is current, subject to Venus satisfying its obligations described below with respect to registration. Venus has agreed that as soon as practicable, but in no event later than 15 business days after the closing of the Business Combination, Venus will use best efforts to file, and within 60 business days following the Business Combination to have declared effective, a registration statement covering the ordinary shares issuable upon exercise of the warrants.

Once the warrants become exercisable, Venus may call the warrants for redemption (excluding the private placement warrants):

If and when the warrants become redeemable by Venus, Venus may not exercise redemption rights if the issuance of shares upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or Venus is unable to effect such registration or qualification.

Holders of warrants are not entitled to voting rights or any right to redemption in the event that Venus consummates a business combination.

Venus currently maintains its principal executive offices at 477 Madison Avenue, 6^th Floor, New York, NY 10022. The cost for this space is included in the $10,000 per month fee that Venus will pay an affiliate of its Sponsor for office space, administrative and support services. Venus considers that its current office space, combined with the other office space otherwise available to its executive officers and directors, adequate for Venus’ current operations.

Venus has two executive officers. These individuals are not obligated to devote any specific number of hours to Venus’ matters and intend to devote only as much time as they deem necessary to Venus’ affairs. The amount of time they will devote in any time period will vary based on whether a target business has been selected for the Business Combination and the stage of the Business Combination process the company is in. Accordingly, once management locates a suitable target business to acquire, they will spend more time investigating such target business and negotiating and processing the business combination (and consequently spend more time to Venus’ affairs) than they would prior to locating a suitable target business. Venus presently expects its executive officers and directors to devote such amount of time as they reasonably believe is necessary to Venus’ business (which could range from only a few hours a week while Venus is trying to locate a potential target business to a majority of their time as Venus moves into serious negotiations with a target business for a business combination). Venus does not intend to have any full time employees prior to the consummation of a business combination.

The following table sets forth selected historical financial information derived from Venus’ unaudited financial statements as of June 30, 2022 and for the six months ended June 30, 2022 and 2021 and the audited financial statements as of December 31, 2021 and 2020 and the audited financial statements as of and for the years ended December 31, 2021 and 2020, each of which is included elsewhere in this proxy statement. Such financial information should be read in conjunction with the audited financial statements and related notes included elsewhere in this proxy statement.

The historical results presented below are not necessarily indicative of the results to be expected for any future period. You should carefully read the following selected financial information in conjunction with the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Venus and Venus’ financial statements and the related notes appearing elsewhere in this proxy statement.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OF VENUS

Venus is a blank check company incorporated on May 14, 2018 in the Cayman Islands with limited liability (meaning Venus’ shareholders have no liability, as members of Venus, for the liabilities of Venus over and above the amount already paid for their shares) formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, or engaging in any other similar Business Combination with one or more businesses or entities. Venus intends to effectuate a Business Combination using cash from the proceeds of its IPO and the sale of the Private Units that occurred simultaneously with the completion of its IPO, its shares, debt or a combination of cash, shares and debt.

On February 11, 2021, Venus consummated its initial public offering of 4,600,000 units, inclusive of the over-allotment option of units. Each unit consists of one ordinary share, par value $0.001 per share (“Share”), one warrant (“Warrant”) entitling its holder to purchase one-half of one ordinary share at a price of $11.50 per ordinary share, and one right to receive one-tenth (1/10) of one ordinary share upon the consummation of the Venus’ initial business combination (together, the “Units”). The Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $46,000,000.

In addition, Venus sold to Ladenburg Thalmann & Co., Inc., the lead bookrunner for the underwriting group, for $75, a total of 75,000 ordinary shares.

Simultaneously with the closing of the IPO, Venus consummated the private placement (“Private Placement”) with its sponsor, Yolanda Management Corporation, for the purchase of 225,000 Units (the “Private Units”) at a price of $10.00 per Private Unit, generating total proceeds of $2,250,000, pursuant to the Private Placement Unit Purchase Agreement, a copy of which was filed as an exhibit to the Registration Statement for the IPO as filed with the SEC.

The Sponsor has previously loaned the Company the sum of $289,000, evidenced by a note dated as of December 20, 2020 (as previously filed as Exhibit 10.9 to the Venus Registration Statement) which loan was payable upon the earlier of completion of the IPO or December 31, 2021. In connection with the completion of the IPO, the Sponsor instructed the Company to offset payment of the note with a corresponding portion of the subscription price for the Private Unit purchase.

Each Private Unit purchased by the Sponsor consists of one ordinary share, one right to receive one-tenth (1/10) of an ordinary share upon the consummation of a business combination and one private placement warrant exercisable to purchase one-half of one ordinary share at a price of $11.50 per whole share.

As of February 18, 2021, a total of $46,460,000 of the net proceeds from the IPO and the Private Placement Unit Purchase Agreement transaction completed with the Sponsor (as described in Item 3.02 below), Yolanda Management Corporation, were deposited in a trust account established for the benefit of the Company’s public shareholders, established with Wilmington Trust, National Association acting as trustee, at an account at Morgan Stanley.

Venus incurred transaction costs for its IPO of $2,462,765, consisting of $805,000 of underwriting fees, $1,150,000 of deferred underwriting fees and $507,765 of other offering costs. In addition, at February 11, 2021, cash of $5,355 and cash held in escrow of $1,960,956 were held outside of the Trust Account (as defined below) and is available for the payment of offering costs and for working capital purposes net with $1,339,925 transferred to Trust Account on February 18, 2021. The Company repaid the sum of $289,000 to its Sponsor in repayment of loans previously made by the Sponsor.

The funds held in trust has been invested only in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 180 days or less, or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations, so that Venus is not deemed to be an investment company under the Investment Company Act. Except with respect to interest earned on the funds held in the trust account that may be released to Venus to pay income or other tax obligations, the proceeds will not be released from the trust account until the earlier of the completion of a business combination or Venus’ redemption of 100% of the outstanding public shares if Venus has not completed a business combination in the required time period. The proceeds held in the trust account may be used as consideration to pay the sellers of a target business with which Venus completes a business combination. Any amounts not paid as consideration to the sellers of the target business may be used to finance operations of the target business.

Venus’ management has broad discretion with respect to the specific application of the net proceeds of the IPO and the private placement, although substantially all of the net proceeds are intended to be applied generally towards consummating a business combination successfully.

Venus’ entire activity from inception up to February 11, 2021 was in preparation for its IPO. Since the IPO, Venus’ activity has been limited to the evaluation of business combination candidates, and it will not be generating any operating revenues until the closing and completion of an initial business combination. Venus expects to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses. Venus expects that its expenses will increase substantially after this period.

For the six months ended June 30, 2022, we had a net loss of $197,426, which was comprised of general and administrative expenses, interest income and change in fair value of warrant liabilities. For the six months ended June 30, 2021, we had a net loss of $306,463, which was comprised of formation, general and administrative expenses, interest income and change in fair value of warrant liabilities.

For the year ended December 31, 2021, Venus had a net loss of $812,413, which was comprised of general and administrative expenses, interest income and change in fair value of warrant liabilities.

On February 11, 2021, we consummated the Initial Public Offering of 4,600,000 Units at a price of $10.00 per Unit, generating gross proceeds of $46,000,000. Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 225,000 Private Units to the sponsor and the underwriter at a price of $10.00 per unit, generating gross proceeds of $2,250,000.

Following the Initial Public Offering and the sale of the Private Units, a total of $45,120,075 was placed in the Trust Account and we had $1,339,925 of cash held outside of the Trust Account, after payment of costs related to the Initial Public Offering, and available for working capital purposes. On February 18, 2021, we transferred $1,339,925 of such amount to the trust account. We incurred $2,462,765 in transaction costs, including $805,000 of underwriting fees, $1,150,000 of deferred underwriting fees and $507,765 of offering costs.

As of June 30, 2022, we had a working capital deficit of $1,442,995 and cash of $10,899. Until the consummation of the initial public offering, the Company’s only source of liquidity was an initial purchase of ordinary shares by the Sponsor, monies loaned by the Sponsor under a certain unsecured promissory note and advances from the Sponsor.

For the six months ended June 30, 2022, cash used in operating activities was $291,191, consisting primarily of a net loss of $197,426 and change in fair value of warrant liabilities of $10,000. Changes in our operating assets and liabilities used cash of $33,033.

For the six months ended June 30, 2021, cash used in operating activities was $374,148, consisting primarily of a net loss of $306,463 and change in fair value of warrant liabilities of $10,000. Changes in our operating assets and liabilities used cash of $76,597.

At June 30, 2022, we had cash of $10,899 held outside the Trust Account. We intend to use the funds held outside the Trust Account primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete a business combination.

On February 10, 2022, we issued a promissory note of $650,000 to our Sponsor for our Sponsor to provide any additional working capital loan to the Company on an as-needed basis towards the consummation of a Business Combination. Outstanding working capital loans, if any, under this promissory note will be paid off by applying the proceeds from the Trust Account after the redemption upon the closing of the Business Combination. As of June 30, 2022, we have a balance of $643,421 loan from our sponsor.

For the year ended December 31, 2021, cash used in operating activities was $748,227, consisting primarily of a net loss of $812,413. Changes in our operating assets and liabilities provided cash of $36,869.

For the year ended December 31, 2020, cash used in operating activities was $77,815, consisting primarily of a net loss of $117,787. Changes in our operating assets and liabilities provided cash of $39,972.

At December 31, 2021, we had cash of $32,090 held outside the Trust Account. We intend to use the funds held outside the Trust Account primarily to identify and evaluate prospective acquisition candidates, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses, review corporate documents and material agreements of prospective target businesses, select the target business to acquire and structure, negotiate and consummate a Business Combination.

We issued an unsecured promissory note to our sponsor in the aggregate amount of $450,000. On February 11, 2021, the outstanding balance under the Promissory Note was repaid in full to the Sponsor.

As of December 31, 2021 and 2020, we had temporary advances of $373,421 and $26,750 from a related party for the payment of costs related to the Initial Public Offering. The balance is unsecured, interest-free and has no fixed terms of repayment.

Other than as described above, in order to fund working capital deficiencies or finance transaction costs in connection with a Business Combination, our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete a Business Combination, we would repay such loaned amounts. In the event that a Business Combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts but no proceeds from our Trust Account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into Private Units, at a price of $10.00 per unit at the option of the lender.

We do not believe we will need to raise additional funds in order to meet the expenditures required for operating our business. However, if our estimate of undertaking in-depth due diligence and negotiating a Business Combination is less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our Business Combination. Moreover, we may need to obtain additional financing either to consummate our Business Combination or because we become obligated to redeem a significant number of our public shares upon consummation of our Business Combination, in which case we may issue additional securities or incur debt in connection with such Business Combination. Subject to compliance with applicable securities laws, we would only consummate such financing simultaneously with the consummation of our Business Combination. Following our Business Combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.

Venus has no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of June 30, 2022. Venus does not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. Venus has not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

Venus does not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities other than an agreement to pay Venus’ Sponsor a monthly fee of $10,000 for general and administrative services, including office space, utilities and administrative services to Venus. Venus began incurring these fees on February 8, 2021 and will continue to incur these fees monthly until the earlier of the completion of the Business Combination and the Company’s liquidation.

The preparation of financial statements and related disclosures in conformity GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and income and expenses during the periods reported. Actual results could materially differ from those estimates. Venus has not identified any significant accounting policies.

Venus accounts for its outstanding IPO related warrants as liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity

(“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations.

Venus accounts for its ordinary shares subject to possible conversion in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Ordinary shares subject to mandatory redemption are classified as a liability instrument and are measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within Venus’ control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. As of June 30, 2022, 4,600,000 ordinary shares subject to possible redemption which are subject to occurrence of uncertain future events and considered to be outside of the Venus’s control are presented as temporary equity, outside of the shareholders’ equity section of the Venus’s unaudited condensed consolidated balance sheet.

Venus applies the two-class method in calculating earnings per share. Ordinary shares subject to possible redemption which are not currently redeemable and are not redeemable at fair value, have been excluded from the calculation of basic net loss per ordinary share since such shares, if redeemed, only participate in their pro rata share of the Trust Account earnings. Venus’ net loss is adjusted for the portion of income that is attributable to ordinary shares subject to redemption, as these shares only participate in the earnings of the Trust Account and not Venus’ income or losses.

As of June 30, 2022, Venus was not subject to any market or interest rate risk. Following the consummation of Venus’ IPO, the net proceeds of the IPO, including amounts in the Trust Account, have been invested in U.S. government treasury bills, notes or bonds with a maturity of 180 days or less or in certain money market funds that invest solely in U.S. treasuries. Due to the short-term nature of these investments, Venus believes there will be no associated material exposure to interest rate risk.

On April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. Venus will qualify as an “emerging growth company” and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. Venus is electing to delay the adoption of new or revised accounting standards, and as a result, Venus may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As such, Venus’ financial statements may not be comparable to companies that comply with public company effective dates.

Additionally, Venus is in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company”, Venus chooses to rely on such exemptions it may not be required to, among other things, (i) provide an independent registered public accounting firm’s attestation report on Venus’ system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm

rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements(auditor discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the consummation of the Business Combination or until Venus is no longer an “emerging growth company,” whichever is earlier.

Disclosure controls are procedures that are designed with the objective of ensuring that information required to be disclosed in our reports filed under the Exchange Act, such as this Report, is recorded, processed, summarized, and reported within the time period specified in the SEC’s rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including the chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure. Our management evaluated, with the participation of our principal executive officer and principal financial and accounting officer (our “Certifying Officers”), the effectiveness of our disclosure controls and procedures as of June 30, 2022, pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, our Certifying Officers concluded that, as of June 30, 2022, solely due to the events that led to the Company’s restatement of its financial statements to reclassify the Company’s Public Warrants, as well as the restatement for the temporary equity subject to possible redemption, as described in the Explanatory Note to this Annual Report, our disclosure controls and procedures were not effective.

We do not expect that our disclosure controls and procedures will prevent all errors and all instances of fraud. Disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Further, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and the benefits must be considered relative to their costs. Because of the inherent limitations in all disclosure controls and procedures, no evaluation of disclosure controls and procedures can provide absolute assurance that we have detected all our control deficiencies and instances of fraud, if any. The design of disclosure controls and procedures also is based partly on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Our internal control over financial reporting did not result in the proper classification of our warrants. Since their issuance on February 11, 2021, our warrants have been accounted for as liabilities within our balance sheet. On April 12, 2021, the SEC Staff issued the SEC Staff Statement in which the SEC Staff expressed its view that certain terms and conditions common to SPAC warrants may require the Public Warrants to be classified as equity on the SPAC’s balance sheet as opposed to liabilities. After discussion and evaluation, taking into consideration the SEC Staff Statement, including with our independent auditors, we have concluded that our Private warrants should be presented as liabilities with subsequent fair value remeasurement.

As previously disclosed, the Company concluded it should restate its financial statements to classify all ordinary shares subject to possible redemption in temporary equity. In accordance with the SEC and its staff’s guidance on redeemable equity instruments, ASC Topic 480, Distinguishing Liabilities from Equity (ASC 480), paragraph 10-S99, redemption provisions not solely within the control of the Company require ordinary shares subject to redemption to be classified outside of permanent equity. The Company had previously classified a portion of its ordinary shares in permanent equity. Although the Company did not specify a maximum redemption threshold, its charter provides that currently, the Company will not redeem its public shares in an amount that would cause its net tangible assets to be less than $5,000,001. The Company considered that the threshold would not change the nature of the underlying shares as redeemable and thus would be required to be disclosed outside equity. As a result, the Company restated its previously filed financial statements to classify ordinary shares subject to redemption as temporary equity and to recognize accretion from the initial book value to redemption value at the time of its IPO and in accordance with ASC 480. The change in the carrying value of redeemable shares of ordinary shares resulted in charges against additional paid-in capital and accumulated deficit.

As a result, management identified these material weaknesses in our internal control over financial reporting related to the accounting for warrants and ordinary shares subject to possible redemption.

To remediate these material weaknesses, we developed a remediation plan with assistance from our accounting advisors and have dedicated significant resources and efforts to the remediation and improvement of our internal control over financial reporting. While we have processes to identify and appropriately apply applicable accounting

requirements, we plan to enhance our system of evaluating and implementing the complex accounting standards that apply to our financial statements. Our plans at this time include providing enhanced access to accounting literature, research materials and documents and increased communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.

On May 17, 2021, Venus revised its prior position on accounting for warrants and concluded that Venus’ previously issued balance as of March 4, 2021 should not be relied on because of a misapplication in the guidance on warrant accounting. However, the non-cash adjustments to the balance do not impact the amounts previously reported for Venus’ cash and cash equivalents, and total assets.

On June 30, 2021, Venus revisited our prior position on accounting for public warrants and concluded that our public warrants as of March 4, 2021 should be reclassified as equity because of a misapplication in the guidance on warrant accounting. However, the non-cash adjustments to the balance do not impact the amounts previously reported for our cash and cash equivalents, and total assets.

On September 30, 2021, Venus revisited our prior position on accounting for ordinary shares subject to possible redemption and concluded that our ordinary shares subject to possible redemption as of March 4, 2021 should be reclassified as equity because of a misapplication in the guidance on ordinary shares subject to possible redemption accounting. However, the non-cash adjustments to the balance do not impact the amounts previously reported for our cash and cash equivalents, and total assets.

In May 2018, Venus issued one ordinary share to the Sponsor for no consideration. On August 21, 2019, Venus cancelled the one share for no consideration and the Sponsor purchased 1,150,000 ordinary shares for an aggregate price of $25,000.

The 1,150,000 founder shares (for purposes hereof referred to as the “Founder Shares”).

The founders and Venus officers and directors have agreed not to transfer, assign or sell any of the Founder Shares (except to certain permitted transferees) until, with respect to 50% of the Founder Shares, the earlier of (i) six months after the date of the consummation of a Business Combination, or (ii) the date on which the closing price of Venus’ ordinary shares equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after a Business Combination, with respect to the remaining 50% of the Founder Shares, upon six months after the date of the consummation of a Business Combination, or earlier, in each case, if, subsequent to a Business Combination, Venus consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of Venus’ shareholders having the right to exchange their ordinary shares for cash, securities or other property.

An affiliate of the Sponsor agreed, commencing on February 8, 2021 through the earlier of Venus’ consummation of a Business Combination and its liquidation, to make available to Venus certain general and administrative services, including office space, utilities and administrative services, as Venus may require from time to time. Venus has agreed to pay the affiliate of the Sponsor $10,000 per month for these services.

In order to finance transaction costs in connection with a Business Combination, Venus’ Sponsor or an affiliate of the Sponsor, or Venus’ officers and directors may, but are not obligated to, loan Venus funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of notes may be converted upon consummation of a Business Combination into additional Private Units

at a price of $10.00 per Unit. In the event that a Business Combination does not close, Venus may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. As of June 30, 2022, the loan balance was $643,421. As of December 31, 2021 and 2020, the Sponsor had advanced to Venus an aggregate of $373,421 and $26,750, respectively. The advances are non-interest bearing and due on demand.

Venus may extend the period of time to consummate a Business Combination up to nine times, each by an additional month (for a total of 21 months to complete a Business Combination). In order to extend the time available for Venus to consummate a Business Combination, the Sponsor or its affiliates or designees must deposit into the Trust Account $153,333 (approximately $0.033 per Public Share), up to an aggregate of $1,380,000, or $0.30 per Public Share, on or prior to the date of the applicable deadline, for each one month extension. Any such payments would be made in the form of a loan. The terms of the promissory note to be issued in connection with any such loans have not yet been negotiated. If Venus completes a Business Combination, Venus would repay such loaned amounts out of the proceeds of the Trust Account released to Venus. If Venus does not complete a Business Combination, it will not repay such loans. Furthermore, the letter agreement with the shareholders contains a provision pursuant to which the Sponsor has agreed to waive its right to be repaid for such loans in the event that Venus does not complete a Business Combination. The Sponsor and its affiliates or designees are not obligated to fund the Trust Account to extend the time for Venus to complete a Business Combination. As of June 30, 2022, the loan balance was $643,421. As of December 31, 2021 and 2020, the principal amount due and owing under the Promissory Note was $0 and $228,483 respectively.

Venus is providing the following unaudited pro forma combined financial information to aid you in your analysis of the financial aspects of the Business Combination.

The unaudited pro forma combined balance sheet as of June 30, 2022 gives pro forma effect to the Business Combination as if it had been consummated as of that date. The unaudited pro forma combined statements of operations for the six months ended June 30, 2022 give pro forma effect to the Business Combination as if it had occurred as of January 1, 2022. This information should be read together with VIYI’s and Venus’ respective audited financial statements and related notes, “Management’s Discussion and Analysis of Financial Condition and Results of Operations of VIYI,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Venus” and other financial information included elsewhere in this proxy statement.

The unaudited pro forma combined balance sheet as of June 30, 2022 has been prepared using the following:

The unaudited pro forma combined statement of operations for the six months ended June 30, 2022 has been prepared using the following:

The unaudited pro forma combined statement of operations for the year ended December 31, 2021 has been prepared using the following:

On June 10, 2021, Venus entered into the Merger Agreement with the Venus Merger Sub, VIYI and WiMi. Pursuant to the terms of the Merger Agreement, the Venus Merger Sub will merge with and into VIYI, with VIYI being the surviving entity and becoming a wholly owned subsidiary of Venus. New Venus refers to Venus after the consummation of the Business Combination The aggregate consideration for the Business Combination is $400,000,000, payable in the form of 39,603,961 newly issued Venus ordinary shares valued at $10.10 per share to VIYI and its shareholders. At the closing of the Business Combination, the issued and outstanding shares in VIYI held by the former VIYI shareholders will be cancelled and ceased to exist, in exchange for the issue of an aggregate of 39,603,961 Venus Ordinary, among which 792,079 New Venus ordinary shares are to be issued and held in escrow to satisfy any indemnification obligations incurred under the Merger Agreement. For more information about the Business Combination, please see the section entitled “Proposals No.1 — The Business Combination Proposal.” A copy of the Merger Agreement is attached to the accompanying proxy statement as Annex A.

The Business Combination will be accounted for as a reverse merger in accordance with U.S. GAAP. Under this method of accounting, Venus will be treated as the “acquired” company for financial reporting purposes. This determination was primarily based on the holders of VIYI expecting to have a majority of the voting power of the post-combination company, VIYI senior management comprising substantially all of the senior management of the post-combination company, the relative size of VIYI compared to Venus, and VIYI operations comprising the ongoing operations of the post-combination company. Accordingly, for accounting purposes, the Business Combination will be treated as the equivalent of VIYI issuing shares for the net assets of Venus, accompanied by a recapitalization. The net assets of Venus will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination will be those of VIYI.

The historical financial information has been adjusted to give pro forma effect to events that are related and/or directly attributable to the Business Combination. The adjustments presented on the unaudited pro forma combined financial statements have been identified and presented to provide relevant information necessary for an accurate understanding of the post-combination company upon consummation of the Business Combination.

The unaudited pro forma combined financial information is for illustrative purposes only. The financial results may have been different had the companies always been combined. You should not rely on the unaudited pro forma combined financial information as being indicative of the historical financial position and results that would have been achieved had the companies always been combined or the future financial position and results that the post-combination company will experience. VIYI and Venus have not had any historical relationship prior to the Business Combination. Accordingly, no pro forma adjustments were required to eliminate activities between the companies.

The unaudited pro forma combined financial information has been prepared assuming two alternative levels of redemption into cash of Venus’ ordinary shares:

Included in the shares outstanding and weighted average shares outstanding as presented in the pro forma combined financial statements are 39,603,961 ordinary shares to be issued to VIYI shareholders under Scenarios 1 and 2.

As a result of the Business Combination and immediately following the closing of the Business Combination, assuming no Venus shareholders elect to redeem their shares for cash, VIYI will own approximately 85.8% of the outstanding Venus ordinary shares, the former shareholders of Venus will own approximately 14.0% of the outstanding Venus ordinary shares and our underwriter from our IPO will own approximately 0.2% of the outstanding Venus ordinary shares as of June 30, 2022 (in each case, not giving effect to any shares issuable to them upon the exercise of any Venus warrants).

If 4,600,000 ordinary shares are redeemed for cash, represents the maximum redemption amount, after giving effect to payments to redeeming shareholders, VIYI will own approximately 95.3% of the outstanding Venus ordinary shares, Venus former shareholders will own approximately 4.5% of the outstanding Venus ordinary shares and our underwriter will own approximately 0.2% of the outstanding Venus ordinary shares as of June 30, 2022 (in each case, not giving effect to any shares issuable to them upon the exercise of any Venus warrants).

PRO FORMA COMBINED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2022
(UNAUDITED)

PRO FORMA COMBINED STATEMENT OF OPERATIONS — Continued
FOR THE SIX MONTHS ENDED JUNE 30, 2022
(UNAUDITED)

PRO FORMA COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2021
(UNAUDITED)

PRO FORMA COMBINED STATEMENT OF OPERATIONS — Continued
YEAR ENDED DECEMBER 31, 2021
(UNAUDITED)

DIRECTORS, EXECUTIVE OFFICERS, EXECUTIVE COMPENSATION
AND CORPORATE GOVERNANCE OF VENUS

Yanming Liu has served as Venus’ Chairman and Chief Executive Officer since January 2020. Mr. Liu served as the Chairman and Chief Executive Officer of Greenland until its acquisition of Zhongchai in October 2019. Mr. Liu currently serves as a director of Greenland’s successor entity, Greenland Technologies Holding Corp. Mr. Liu has served as President of CoAdna (Suzhou), a fiber optics solutions company in China, since March 2013. From November 2010 to February 2013, Mr. Liu served as President of two optical access business units of HiSense Broadband and Multimedia Technologies, an optical communications company. From March to October 2010, Mr. Liu served as a senior advisor to EJ McKay & Co., Inc. with respect to various technology matters. From August 2005 to February 2010, Mr. Liu served as President and Chief Executive Officer of Salira Systems Inc., a producer of optical access products in China and the U.S. Previously, Mr. Liu served as an executive of Optovia Corporation and Walsin Management Company. In addition, from 1993 to 2001, Mr. Liu worked in various roles for Corning Incorporated, most recently as Director of Communications Electronics and Integration, where his roles included invention of Corning’s award-winning patented LEAF fiber product and marketing such product in China and other markets. Mr. Liu received a bachelor degree from Tianjin University in China, a MBA degree from the MIT Sloan School of Management and a Ph.D. and a MA degree from Princeton University.

River Chi has served as the Chief Financial Officer since October 2020. Mr. Chi served as the Chief Financial Officer of Greenland until its acquisition of Zhongchai in October 2019. Mr. Chi has served as the Chief Executive Officer of Alum Developing (Shanghai), Inc., a distributor of alloys in China, since November 2017 and previously served as Venus’ Chief Operating Officer starting in 2013. From 2007 until 2012, Mr. Chi served as the operations manager of Salira (China) Network System Inc., where he worked with Mr. Liu. From 2005 to 2007, Mr. Chi served as project manager for AsteelFlash Electronics (Shanghai) Co., Ltd., an international electronic manufacturing services company. From 2003 to 2005, Mr. Chi served as manufacturing engineer for Darfon Electronics (SuZhou) Co., Ltd., a manufacturer of telecommunication components and precision devices. Mr. Chi received a bachelor degree from Northeastern University and a MBA from Shanghai Jiao Tong University.

Yu Chen has served as Venus’ director as of the closing of Venus’ IPO. Mr. Chen served as the Director of Greenland until its acquisition of Zhongchai in October 2019. Mr. Chen has served as founder and Chief Executive Officer of Nanjing Covision Optoelectronics Co., Ltd., a developer of display and lighting applications in China, since October 2013. From 2009 to 2013, Mr. Chen worked at HiSense Broadband and Multimedia Technologies, where he worked with Mr. Liu, most recently serving as a Deputy Director of Technology. In 2008, Mr. Chen served as a senior engineer for Luminus Devices, a designer of light extractions for LED products. Prior to that, Mr. Chen worked as an engineer for various technology companies in China and North American and as a researcher at the University of Waterloo, since 1986. Mr. Chen received a master’s degree from the University of Waterloo in Canada and a Ph.D. from McMaster University in Canada.

Shan Cui has served as Venus’ director as of the closing of Venus’ IPO. She has been an independent director and chair of the audit committee and compensation committee of Fuqin Fintech Limited, an online lending information intermediary platform, since August 28, 2018. She has been the Executive Director of First Capital International Limited since 2010 and provided consulting services for private equity companies and venture capital companies. She was the CFO of Lizhan Environmental Corporation, a then Nasdaq-listed company engaged in the business of green leather material manufacturing, from 2011 to 2013. From 2009 to 2010, she was the Manager of

Planning and Analysis for Greene, Tweed & Company, a manufacturer of high-performance engineering parts and products serving aerospace, oilfield, and semi-conductor industries. Prior to that, Ms. Cui was the Senior Finance Manager at Ikon Office Solutions from 2005 to 2008, the CFO for Invista from 2003 to 2004, the Senior Financial Consultant for the Peachtree Companies from 2001 to 2003, the Manager of Strategic Planning and Analysis for General Time Corporation from 1998 to 2001, and the Senior Vice President for Seaboard Corporation from 1996 to 1998. Ms. Cui acquired her MBA degree in Business Administration from Georgia State University and her Bachelor’s degree in International Business English from Ocean University of China.

Guojian Chen has served as Venus’ director as of the closing of Venus’ IPO. Mr. Chen serves as the Secretary of Board of Beijing ChinaReel Art Exchange Inc. a leading copyright operator focusing on high-quality video content, since May 2020, where he is in charge of investor relations and corporate finance matters for Venus. Mr. Chen served as a director of Beijing Zhongqixinhe Enterprise Management Consulting Co., Ltd., a financial advisory firm with focus on financial, real estate and TMT industry from May 2019 to May 2020. Mr. Chen served as an analyst of Zhongrong Huitong Investment Fund Management (Zhuhai) Co. LTD. from July 2018 to May 2019. Mr. Chen received his Bachelor degree of Management from Renmin University of China in 2015, and Master of Finance from the University of Chinese Academy of Sciences in June 2018.

None of Venus’ officers or directors have received any cash or non-cash compensation for services rendered to Venus. Commencing on the date that Venus’ securities are first listed on the NASDAQ through the earlier of consummation of the Business Combination and Venus’ liquidation, Venus pays an affiliate of Venus’ sponsor a total of $10,000 per month for office space, administrative and support services. Venus’ sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on Venus’ behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. As of September 1, 2021, these expenses aggregate approximately $___________. Venus’ audit committee will review on a quarterly basis all payments that were made to its sponsor, officers, directors or Venus’ or their affiliates.

After the completion of a business combination, directors or members of Venus’ management team who remain with Venus may be paid consulting, management or other fees from the combined company. Other than the nomination of one director to the Board of Directors of New Venus, none of the officers or directors of Venus will be employed by New Venus.

The Nasdaq listing standards require that a majority of Venus’ Board of Directors be independent. An “independent director” is defined generally as a person who has no material relationship with the listed company (either directly or as a partner, shareholder or officer of an organization that has a relationship with Venus). Venus’ board has determined that each of Messrs. Yu Chen and Guojian Chen and Ms. Shan Cui are independent directors under applicable SEC and NASDAQ rules. Following the completion Venus’ IPO, Venus’ independent directors have had and will have regularly scheduled meetings at which only independent directors are present.

The members of Venus’ audit committee include Messrs. Yu Chen, Guojian Chen and Ms. Shan Cui. Ms. Shan Cui is the chairman of the audit committee.

Each member of the audit committee is financially literate and Venus’ board of directors has determined that Ms. Shan Cui qualifies as an “audit committee financial expert” as defined in applicable SEC rules.

Venus has adopted an audit committee charter, which details the principal functions of the audit committee, including:

The members of Venus’ Compensation Committee include Messrs. Yu Chen and Guojian Chen and Ms. Shan Cui. Mr. Guojian Chen serves as chairman of the compensation committee. The compensation committee is guided by a compensation committee charter, which details the principal functions of the compensation committee, including:

The charter will also provide that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, legal counsel or other adviser and will be directly responsible for the appointment, compensation and oversight of the work of any such adviser. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other adviser, the compensation committee will consider the independence of each such adviser, including the factors required by the NASDAQ and the SEC.

None of Venus’ officers currently serves, and in the past year has not served, (i) as a member of the compensation committee or Board of Directors of another entity, one of whose executive officers served on Venus’ compensation committee, or (ii) as a member of the compensation committee of another entity, one of whose executive officers served on Venus’ Board of Directors.

Venus does not have a standing nominating committee though Venus intends to form a corporate governance and nominating committee as and when required to do so by law or Nasdaq rules. In accordance with Rule 5605 of the NASDAQ rules, a majority of the independent directors may recommend a director nominee for selection by the Board of Directors. The Board of Directors believes that the independent directors can satisfactorily carry out the responsibility of properly selecting or approving director nominees without the formation of a standing nominating committee. The directors who will participate in the consideration and recommendation of director nominees are Messrs. Yu Chen and Guojian Chen and Ms. Cui. In accordance with Rule 5605 of the NASDAQ rules, all such directors are independent. As there is no standing nominating committee, Venus does not have a nominating committee charter in place.

Prior to the Business Combination, the Board of Directors will also consider director candidates recommended for nomination by holders of Venus’ founder shares during such times as they are seeking proposed nominees to stand for election at an annual meeting of shareholders (or, if applicable, a extraordinary general meeting of shareholders). Prior to the Business Combination, holders of Venus’ public shares will not have the right to recommend director candidates for nomination to Venus’ board.

Venus has not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating nominees for director, the Board of Directors considers educational background, diversity of professional experience, knowledge of Venus’ business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of Venus’ shareholders.

Section 16(a) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, requires Venus’ executive officers, directors and persons who beneficially own more than 10% of a registered class of its equity securities to file with the Securities and Exchange Commission initial reports of ownership and reports of changes in ownership of Venus’ ordinary share and other equity securities. These executive officers, directors, and greater than 10% beneficial owners are required by SEC regulation to furnish Venus with copies of all Section 16(a) forms filed by such reporting persons.

Based solely on Venus’ review of such forms furnished by Venus’ executive officers, directors and persons who beneficially own more than 10% of a registered class of Venus’ equity securities and written representations from certain reporting persons, Venus believes that all filing requirements applicable to its executive officers, directors and greater than 10% beneficial owners were filed in a timely manner during the fiscal year ended December 31, 2019 and 2020.

You are able to review Venus’ Code of Ethics applicable to its directors, officers and employees documents by accessing Venus’ public filings at the SEC’s web site at www.sec.gov. In addition, a copy of the Code of Ethics will be provided without charge upon request from Venus. Venus intends to disclose any amendments to or waivers of certain provisions of its Code of Ethics in a Current Report on Form 8-K. See “Where You Can Find Additional Information.”

New Venus’ Board of Directors will consist of five directors, including three independent directors, namely Shan Cui, Haixin Zhao and Wengang Kang, upon the closing of the Business Combination. Shan Cui is currently a director of Venus. A director is not required to hold any shares in New Venus to qualify as a director. The Listing Rules of the NASDAQ generally require that a majority of an issuer’s board of directors must consist of independent directors.

A director who is in any way, whether directly or indirectly, interested in a contract or proposed contract with New Venus is required to declare the nature of his or her interest at a meeting of New Venus’ directors. A general notice given to the directors by any director to the effect that he or she is a member, shareholder, director, partner, officer or employee of any specified company or firm and is to be regarded as interested in any contract or transaction with that company or firm shall be deemed a sufficient declaration of interest for the purposes of voting on a resolution in respect to a contract or transaction in which he/she has an interest, and after such general notice it shall not be necessary to give special notice relating to any particular transaction. A director may vote in respect of any contract or proposed contract or arrangement notwithstanding that he/she may be interested therein and if he/she does so, his/her vote shall be counted and he/she may be counted in the quorum at any meeting of the directors at which any such contract or proposed contract or arrangement is considered. New Venus’ Board of Directors may exercise all of the powers to borrow money, to mortgage or charge its undertaking, property and uncalled capital, or any part thereof, and to issue debentures, debenture stock or other securities whenever money is borrowed or as security for any debt, liability or obligation of New Venus or of any third party. None of New Venus’ directors has a service contract with New Venus that provides for benefits upon termination of service as a director.

New Venus’ directors and executive officers upon the consummation of the Business Combination will be as follows:

Jie Zhao will serve as New Venus’ chairman of the board of directors upon the closing of the Business Combination. Jie Zhao joined the WiMi group of companies in August 2015 as the chairman of Yitian Internet. He was appointed as the director and chairman of the board in November 2020 and re-designated as a non-executive director. He also served as the chairman of the company’s nomination committee. Prior to joining the WiMi group of companies, Jie Zhao served as a software developer for AsiaInfo Beijing Co., Ltd., a company specializing in computer systems in China from 2002 to 2004. From December 2004 to December 2012, he served as director of Shenzhen WeiXun YiTong Technology Co., Ltd., a mobile internet company in China. From February 2008 to May 2015, he served as a director of Xiamen Xiangtong Animation Co., Ltd., a mobile animation company in China. Jie Zhao graduated from Wuhan University of Technology with a bachelor degree in robotics design and manufacturing in 1999 and obtained his master’s degree in software engineering from Tsinghua University in 2006.

Min Shu will serve as New Venus’executive director, chief executive officer upon the closing of the Business Combination. Min Shu joined the WiMi group of companies in June 2018 as the deputy general manager of technology. Prior to joining the WiMi group of companies, he served as a software development engineer at Shenzhen Integvol Information Technology Co., Ltd. from 2001 to 2006, where he was responsible for software development and system architecture, and the development and design of a mobile application platform. From 2006 to 2012, he served as a senior software technical engineer at Shanghai Motegor Technology Co., Ltd., where he was responsible for the management of software development and system architecture. From June 2012 to

April 2018 he served as the chief technical officer at Shanghai BlueSky Information Technology Co.,Ltd. Where he was responsible for the management of technology development and system architecture. Min Shu graduated from Huazhong University of Science and Technology with a bachelor degree in electrical engineering and automation in July 1999 and obtained his master’s degree in communication engineering from Huazhong University of Science and Technology in 2001

Chengwei Yi will serve as New Venus’ chief technical officer upon the closing of the Business Combination. Chengwei Yi joined the WiMi group of companies in March 2011 as the director and general manager of Yitian Internet. Prior to joining the WiMi group of companies, he served as a software development engineer at Shenzhen Aotian Information Technology Co., Ltd. from 2001 to 2004, where he was responsible for managing short message service network connections and mobile network connections, and the development and design of a network payment platform. From March 2004 to September 2010, he served as a products and services manager at Shenzhen Aspire DigitalCo., Ltd., where he was responsible for the management of company systems and business development. From September 2010 to April 2013 he served as the chief technical officer at Shenzhen WeiXun Mobile Information Technology Co.,Ltd. Where he was responsible for product planning, development and management. Chengwei Yi graduated from Shenyang Institute of Technology with a degree in electronics and measurement technology in July 1998. He is also an EMBA candidate from China Europe International Business School.

Shan Cui will serve as New Venus’ Independent Director upon the closing of the Business Combination. She has been an independent director and chair of the audit committee and compensation committee of Fuqin Fintech Limited, an online lending information intermediary platform, since August 28, 2018. She has been the Executive Director of First Capital International Limited since 2010 and provided consulting services for private equity companies and venture capital companies. She was the CFO of Lizhan Environmental Corporation, a then Nasdaq-listed company engaged in the business of green leather material manufacturing, from 2011 to 2013. From 2009 to 2010, she was the Manager of Planning and Analysis for Greene, Tweed & Company, a manufacturer of high-performance engineering parts and products serving aerospace, oilfield, and semi-conductor industries. Prior to that, Ms. Cui was the Senior Finance Manager at Ikon Office Solutions from 2005 to 2008, the CFO for Invista from 2003 to 2004, the Senior Financial Consultant for the Peachtree Companies from 2001 to 2003, the Manager of Strategic Planning and Analysis for General Time Corporation from 1998 to 2001, and the Senior Vice President for Seaboard Corporation from 1996 to 1998. Ms. Cui obtained her MBA degree in Business Administration from Georgia State University and her Bachelor’s degree in International Business English from Ocean University of China.

Haixia Zhao will serve as New Venus’ Independent Director upon the closing of the Business Combination. Ms. Zhao had over 15 years of management experience in the energy industry, where she gained substantial skills and knowledge in energy sector. From June 2019, she served as the independent director and chair of the risk committee at Sterlite Power Transmission Limited. From January 2010 to December 2018, she was the president of BP Singapore Pte. Ltd. Where she was responsible for downstream and marketing in the eastern hemisphere. on October 1996. From January 2010 to December 2016, she served as a director at Guangdong Dapeng LNG Company Ltd. where she served on the investment committee. From January 1993 to June 2010, she worked at the AES Corporation, a company listed on the New York Stock Exchange (stock code: AES) in Singapore and her last position was the general manager where she was responsible for the growth strategy in Asia and Middle East region. She was appointed as a director of AES Transpower Private Ltd. From July 1987 to December 1991 she was an Assistant Manager at China Construction Bank, where she was responsible for client development. Ms. Zhao graduated with a bachelor’s degree majoring in Civil Engineering and a bachelor’s degree majoring in physics from Zhejiang University in the PRC in 1987, and a master’s degree in construction management from University of Maryland in the United States in 1993.

Wengang Kang will serve as New Venus’ Independent Director upon the closing of the Business Combination. Mr. Kang has over four years of experience in the legal industry, where he gained substantial skills and knowledge in legal industry. From July 2017 to June 2018, Mr. Kang was an associate at Shanghai Ximu Law Firm. From June 2018 to January 2020, Mr. Kang was an associate at Beijing Zhongyin (Shanghai) Law Firm, where he advised on corporate legal matters. Since 2020, he has been a partner of Shanghai Yingdong Law Firm. Mr. Kang graduated with a degree in law at the Gansu Institute of Political Science and Law in the PRC in July 2013.

Li He will serve as New Venus’ chief financial officer upon the closing of the Business Combination. Li He joined the WiMi group in October 2020 as the financial controller of Yitian Internet and was appointed as chief financial officer in October 2020 Prior to joining, he served as a relationship manager at Royal Bank of Scotland (China) Limited Shenzhen Branch between 2007 and 2010. From June 2010 to July 2015, he served as an investment director at JPMorgan Asset Management, where he was responsible for investments in China. From August 2015 to February 2019, He was appointed as the vice president of the investment division at Yingxin Investment Group Co., Ltd., where he was in charge of managing the company’s investment. He Li graduated with a degree in international economics and trade at Shenzhen University in the PRC in July 2007.

Shiwen Liu will serve as New Venus’ chief operating officer upon the closing of the Business Combination. Liu Shiwen joined VIYI in August, and he was appointed as deputy general manager in October 2020. Prior to joining VIYI, he founded Shengshi Yunfan Digital Image Technology Co., Ltd and served as the general manager from June 2010 to August 2019. From 2006 to 2009, he served as project director of Shenzhen Sun Vision Creative Technology Co., Ltd. From 2003 to 2005, he served as project manager of Shenzhen Yingchuang Landscape Design Consulting Co., Ltd. Shiwen Liu graduated from Hunan City University with a bachelor’s degree in business administration.

Upon the closing of the Business Combination, New Venus intends to re-constitute the membership of the audit committee, compensation committee and nominating and corporate governance committee under its Board of Directors. The existing charters previously adopted by Venus following its IPO will continue in effect upon the closing of the Business Combination. Each committee’s members and functions are described below.

New Venus’ audit committee will consist of 3 Independent Directors, chaired by Cui Shan. New Venus has determined that each of them satisfies the “independence” requirements of Rule 5605(c)(2) of the Listing Rules of the Nasdaq and meet the independence standards under Rule 10A-3 under the Exchange Act, as amended. New Venus has determined that Cui Shan qualifies as an “audit committee financial expert.” The audit committee oversees New Venus’ accounting and financial reporting processes and the audits of its financial statements. The audit committee is responsible for, among other things:

Under Cayman Islands law, New Venus’ directors owe fiduciary duties to New Venus, including a duty of loyalty, a duty to act honestly and a duty to act in what they consider in good faith to be in New Venus’ best interests. New Venus’ directors must also exercise their powers only for a proper purpose. New Venus’ directors also owe to New Venus a duty to exercise skills they actually possess and such care and diligence that a reasonably prudent person would exercise in comparable circumstances. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and experience. However, English and Commonwealth courts have moved towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands. In fulfilling their duty of care to New Venus, New Venus’ directors must ensure compliance with New Venus’ Memorandum and Articles of Association, as amended and restated from time to time. New Venus has the right to seek damages if a duty owed by its directors is breached. In limited exceptional circumstances, a shareholder may have the right to seek damages in New Venus’ name if a duty owed by New Venus’ directors is breached. New Venus’ Board of Directors has all the powers necessary for managing, and for directing and supervising, New Venus’ business affairs. The functions and powers of New Venus’ Board of Directors include, among others, (i) convening shareholders’ annual and extraordinary general meetings and reporting its work to shareholders at such meetings, (ii) declaring dividends and distributions, (iii) appointing directors or officers and determining their terms of offices and responsibilities, (iv) exercising the borrowing powers of New Venus and mortgaging property of New Venus, and (v) approving the transfer of shares of New Venus, including the registering of such shares in New Venus’ register of members.

New Venus’ officers are elected by and serve at the discretion of the board. Each director is not subject to a term of office and holds office until such time as his successor takes office or until the earlier of his death, resignation or removal from office by ordinary resolution of all shareholders. A director will be removed from office automatically if, among other things, the director (i) becomes bankrupt or makes any arrangement or composition with his creditors; (ii) dies or is found by New Venus to be of unsound mind; (iii) resigns by notice in writing to New Venus; (iv) is prohibited by law from being a director; or (v) is removed from office pursuant to any other provisions of New Venus’ Memorandum and Articles Of Association.

A director may, subject to any separate requirement for audit committee approval under applicable law or applicable Nasdaq rules, vote in respect of any contract or transaction in which he or she is interested, provided that the nature of the interest of any directors in such contract or transaction is disclosed by him or her at or prior to its consideration and any vote in that matter.

VIYI paid an aggregate of US$ 47,763.46 and US$ 138,576.00 in cash to its directors and executive officers for the years ended December 31, 2020 and 2021, respectively. All executive officers and non-employee directors receive cash at the beginning of their tenure on the board and are otherwise uncompensated for their service. The cash compensation for each director and executive officer for the fiscal years ended December 31, 2020 and 2021 is set forth below.

This discussion may contain forward-looking statements that are based on VIYI’s current plans, considerations, expectations and determinations regarding future compensation programs. VIYI has not yet made any determinations with respect to the compensation of the executive officers following the Merger, other than as described below. Actual compensation programs that New Venus adopts in the future may differ materially from the currently planned programs summarized in this discussion.

The named executive officers and non-employee directors receive a base salary to compensate them for services rendered to VIYI. The base salary payable to each named executive officer and non-employee directors is intended to provide a fixed component of compensation reflecting his or her skill set, experience, role and responsibilities. The actual base salaries paid to each named executive officer and non-employee director for 2020 and 2019 are set forth in the table above in the column titled “Salary.”

VIYI does not currently maintain an annual bonus program for its employees, including its named executive officers and non-employee directors. None of VIYI’s named executive officers or directors received any bonus payments with respect to their services in 2020 and 2019.

VIYI did not grant any stock options or restricted stock units to its named executive officers or directors in or prior to 2020.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT OF VENUS PRIOR TO THE BUSINESS COMBINATION

The following table sets forth as of [ ], 2021 the number of Venus ordinary shares beneficially owned by (i) each person who is known by Venus to be the beneficial owner of more than five percent of Venus’ issued and outstanding ordinary shares (ii) each of Venus’ officers and directors; and (iii) all of Venus’ officers and directors as a group. As of [October ], 2021 Venus had 6,050,000 ordinary shares issued and outstanding.

Unless otherwise indicated, Venus believes that all persons named in the table have sole voting and investment power with respect to all Venus ordinary shares beneficially owned by them. The following table does not reflect beneficial ownership of the warrants or rights included in the units issued in its initial public offering or the private warrants included the private placement as these warrants are not exercisable and these rights are not convertible at this time or within the next 60 days. As Venus’ IPO registration statement and Form 8A were not declared effective by the SEC until February 8, 2021, Venus was not a filing company under the Securities and Exchange Act of 1934, as amended until February 8, 2021. As of October __, 2021, there were 6,050,000 ordinary shares (assuming the ordinary shares are split from the units which has not yet occurred) issued and outstanding and upon which we base the information in the table below.

Venus’ sponsor, officers and Mr. Tiger Zhang are deemed to be Venus’ “promoters” as such term is defined under the federal securities laws. See “Certain Relationships and Related Party Transactions” for additional information regarding Venus’ relationships with its promoters. Mr. Zhang is a member of Venus’ sponsor and has provided services related to Venus’ formation and its IPO. Mr. Zhang received membership interests in Venus’ sponsor, as compensation for such services, such membership interests reflect pecuniary interest in approximately 50,000 founder shares.

The ordinary shares owned by Venus’ sponsor, Yolanda Management Corporation, may be voted or disposed of by Yanming Liu who has sole voting control of Yolanda Management Corporation. As a result, Yanming Liu may be deemed the beneficial owner of such ordinary shares.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT OF VIYI PRIOR TO THE BUSINESS COMBINATION

The following table sets forth the number of VIYI ordinary shares beneficially owned by each VIYI shareholder as of October __, 2021. As of October __, 2021, VIYI had 300,000,000 ordinary shares issued and outstanding.

SECURITY OWNERSHIP OF THE COMBINED COMPANY NEW VENUS
AFTER THE BUSINESS COMBINATION

The following tables sets forth information regarding the beneficial ownership of New Venus ordinary shares immediately after the consummation of the Business Combination by:

Unless otherwise indicated, New Venus believes that all persons named in the table will have, immediately after the consummation of the Business Combination, sole voting and investment power with respect to all New Venus’ securities beneficially owned by them.

Beneficial ownership is determined in accordance with SEC rules and includes voting or investment power with respect to securities. Except as indicated by the footnotes below, New Venus believes, based on the information furnished to it, that the persons and entities named in the table below will have, immediately after the consummation of the Business Combination, sole voting and investment power with respect to all stock that they beneficially own, subject to applicable community property laws. All New Venus ordinary shares subject to options or warrants exercisable within 60 days of the consummation of the Business Combination are deemed to be outstanding and beneficially owned by the persons holding those options or warrants for the purpose of computing the number of shares beneficially owned and the percentage ownership of that person. They are not, however, deemed to be outstanding and beneficially owned for the purpose of computing the percentage ownership of any other person.

Subject to the paragraph above, percentage ownership of issued shares is based on 45,653,961 New Venus ordinary shares to be issued and outstanding upon consummation of the Business Combination. Such amount includes 39,603,961 to be issued to VIYI shareholders, and 6,050,000 Venus Public Shares which would be issued and outstanding upon the split of Venus’ units into its component parts.

According to the Provisions on Guiding the Direction of Foreign Investment, which took effect on April 1, 2002, industries in the PRC are classified into four categories: “permitted foreign investment industries”, “encouraged foreign investment industries”, “restricted foreign investment industries” and “prohibited foreign investment industries”. “Encouraged foreign investment industries”, “restricted foreign investment industries” and “prohibited foreign investment industries” are stipulated in the Catalog. Industries which do not fall in any of these three categories are regarded as “permitted foreign investment industries”. The Catalog is promulgated and is amended by the NDRC and the MOFCOM. The Negative List, which was last amended on June 23, 2020 and subsequently enforced on July 23, 2020 by the NDRC and the MOFCOM and replace the Catalog, sets forth management measures for the market entry of foreign investors, such as equity requirements and senior manager requirements. According to the Negative List, any internet cultural activities (except for the provision of music) is a foreign investment prohibited industry, and foreign-invested shares of value-added telecommunications services must not exceed 50% (excluding e-commerce, domestic multi-party communications services, store and forward services and call center services) of the business.

An enterprise which establishes, operates and manages within the Chinese territory is subject to the PRC Company Law last amended on October 26, 2018. The PRC Company Law is also applicable to a foreign investment company. Nevertheless, where there are other special laws relating to foreign investment, such laws shall prevail.

The procedures for the establishment of a wholly foreign-owned enterprise, the verification, registration and approval procedures, registered capital requirements, foreign exchange restrictions, accounting practices, taxation and labor matters are subject to the Law on Wholly Foreign-invested Enterprises of the PRC, which was last amended on September 3, 2016 and subsequently enforced on October 1, 2016 and the Implementation Regulations for Law on Wholly Foreign-invested Enterprises of the PRC, which was last amended on February 19, 2014 and subsequently enforced on March 1, 2014 and Provisional Administration Measures for the Registration of the Formation and Changes of Foreign Invested Enterprises (the “Measures”) which was last amended on June 29, 2018 and subsequently enforced on June 30, 2018.

According to the Measures, where the incorporation of foreign-invested enterprises does not fall within the scope of the Negative List, such enterprises shall file and submit the record-filing information on the incorporation of foreign-invested enterprises simultaneously when they go through the registration procedures for incorporation. Within the record-filing scope of the Measures, in the case of a change of basic information of the foreign-invested enterprises or their investors, a change of equity (shares) or cooperation interest of the foreign-invested enterprises, merger, division or dissolution, mortgage or transfer of foreign invested enterprise’s property or rights and interests to others and other matters, the foreign-invested enterprise shall file the relevant documents online within 30 days upon occurrence of such changes via the comprehensive administrative system.

On December 30, 2019, the MOC and the State Administration of Market Regulation issued the Measures for the Reporting of Foreign Investment Information, which came into effect on January 1, 2020 and replaced the Measures. Since January 1, 2020, for foreign investors carrying out investment activities directly or indirectly in China, the foreign investors or foreign-invested enterprises shall submit investment information to the commerce authorities pursuant to these measures.

On March 15, 2019, the NPC approved the Foreign Investment Law, which became effective on January 1, 2020, and replaced the Sino-foreign Equity Joint Venture Enterprise Law, the Sino-foreign Cooperative Joint Venture Enterprise Law and the Wholly Foreign-invested Enterprises Law. On December 26, 2019, the State Council issued the Regulations on Implementing the Foreign Investment Law of the PRC, which came into effect on January 1, 2020, and replaced the Regulations on Implementing the Sino-Foreign Equity Joint Venture Enterprise Law, Provisional Regulations on the Duration of Sino-Foreign Equity Joint Venture Enterprise Law, the Regulations on Implementing the Wholly Foreign-Invested Enterprise Law, and the Regulations on Implementing the Sino-foreign Cooperative Joint Venture Enterprise Law.

Under the Foreign Investment Law, the State shall implement the management systems of pre-establishment national treatment and negative list for foreign investment, according to which the treatment given to foreign investors and their investments during the investment access stage shall be not lower than that given to their domestic counterparts, and the State shall give national treatment to foreign investment beyond the negative list where special

administrative measures for the access of foreign investment in specific fields is specified. Besides, the State shall protect foreign investors’ investment, earnings and other legitimate rights and interests within the territory of China in accordance with the law. The state will take measures to prompt foreign investment such as ensuring fair competition for foreign-invested enterprises to participate in government procurement activities, and protection of intellectual property rights of foreign investors and foreign-invested enterprises.

As advised by Guangdong Jiayin law firm, VIYI’s PRC counsel, VIYI’s ownership structure are in compliance with existing PRC laws and regulations in all material respects. Based on VIYI’s current understanding of the current PRC laws, the ownership structure of the PRC Companies, both currently and immediately after giving effect to the offering, does not and will not violate applicable PRC Laws currently in effect. However, there are substantial uncertainties regarding the interpretation and application of PRC Laws and future PRC laws and regulations, and there can be no assurance that the PRC Authorities will not take a view that is contrary to or otherwise different from the opinion stated above.

The Regulations on Mergers and Acquisitions of Domestic Companies by Foreign Investors, or the M&A Rules, adopted by six PRC regulatory agencies in 2006 and amended in 2009, and some other regulations and rules concerning mergers and acquisitions established complex procedures and requirements for acquisition of Chinese companies by foreign investors, including requirements in some instances that the Ministry of Commerce of the PRC be notified in advance of any change-of-control transaction in which a foreign investor takes control of a PRC domestic enterprise.

The M&A Rules, among other things, purport to require that an offshore special purpose vehicle controlled directly or indirectly by PRC domestic companies or individuals and formed for purposes of overseas listing through acquisition of PRC domestic interests obtain the approval of the CSRC prior to the listing and trading of such special purpose vehicle’s securities on an overseas stock exchange. The CSRC has not issued any definitive rules or interpretations concerning whether offerings such as this offering are subject to the CSRC approval procedures under the M&A Rules.

As advised by Guangdong Jiayin law firm, VIYI is not required to obtain approval from the CSRC under the M&A Rules for listing and trading of its securities after the consummation of the Business Combination. However, uncertainties still exist as to how the M&A Rules will be interpreted and implemented and the opinion stated above is subject to any new laws, rules and regulations or detailed implementations and interpretations in any form relating to the M&A Rules.

On December 24, 2021, the CSRC and relevant departments of the State Council published the Draft Rules Regarding Overseas Listings, which aim to regulate overseas securities offerings and listings by China-based companies and are available for public consultation. The Draft Rules Regarding Overseas Listing aim to lay out the filing regulation arrangement for both direct and indirect overseas listing, and clarify the determination criteria for indirect overseas listing in overseas markers. The Draft Rules Regarding Overseas Listing, among other things, stipulate that, after making initial applications with overseas stock markets for initial public offerings or listings, all China-based companies shall file with the CSRC within three working days. The required filing materials with the CSRC include (without limitation): (i) record-filing reports and related undertakings, (ii) compliance certificates, filing or approval documents from the primary regulator of the applicants’ businesses (if applicable), (iii) security assessment opinions issued by related departments (if applicable), (iv) PRC legal opinions, and (v) proxy statement. In addition, overseas offerings and listings may be prohibited for such China-based companies when any of the following applies: (1) if the intended securities offerings and listings are specifically prohibited by the laws, regulations or provision of the PRC; (2) if the intended securities offerings and listings may constitute a threat to, or endanger national security as reviewed and determined by competent authorities under the State Council in accordance with laws; (3) if there are material ownership disputes over applicants’ equity interests, major assets, core technologies, or the others; (4) if, in the past three years, applicants’ domestic enterprises, controlling shareholders or de facto controllers have committed corruption, bribery, embezzlement, misappropriation of property, or other criminal offenses disruptive to the order of the socialist market economy, or are currently under judicial investigation for suspicion of criminal offenses, or are under investigation for suspicion of major violations; (5) if, in the past three years, any directors, supervisors, or senior executives of applicants have been subject to administrative punishments for severe violations, or are currently under judicial investigation for suspicion of criminal offenses, or are under

investigation for suspicion of major violations; (6) other circumstances as prescribed by the State Council. VIYI does not believe any of the six prohibited situations aforementioned applies to it. The Draft Administrative Provisions further stipulate that a fine between RMB 1 million and RMB 10 million may be imposed if an applicant fails to fulfill the filing requirements with the CSRC or conducts an overseas offering or listing in violation of the Draft Rules Regarding Overseas Listings, and in cases of severe violations, a parallel order to suspend relevant businesses or halt operations for rectification may be issued, and relevant business permits or operational license revoked.

The Telecommunications Regulations of the PRC (the “Telecommunications Regulations”), which took effect on September 25, 2000 and was last amended on February 6, 2016, provide a regulatory framework for telecommunications service providers in China. The Telecommunications Regulations require telecommunications service providers to obtain an operating license prior to the commencement of their operations. The Telecommunications Regulations categorize telecommunications businesses into basic telecommunications businesses and value-added telecommunications businesses. According to the Catalog of Telecommunications Business, which was attached to the Telecommunications Regulations and was last amended by the MIIT on June 6, 2019, information service provided via fixed network, mobile network and internet fall within the scope of value-added telecommunications services.

The Administrative Measures on Internet Information Services (the “Internet Measures”), which took effect on September 25, 2000 and was last amended on January 8, 2011, set out guidelines on the provision of internet information services. The Internet Measures classified internet information services into commercial internet information services and non-commercial internet information services, and a commercial operator of internet content provision services must obtain a value-added telecommunications operating license (the “ICP License”) for the provision of internet information services from the appropriate telecommunications authorities.

The Administrative Measures for Telecommunications Businesses Operating Licensing, which took effect on September 1, 2017, provide that a commercial operator of value-added telecommunications services must first obtain an ICP License from MIIT or its provincial level counterparts. In addition, in the first quarter of every year while the operator is holding the license, the operator must report information such as business performance and service quality to the issuing authorities.

Foreign direct investment in telecommunications companies in China is governed by the Regulations for the Administration of Foreign-Invested Telecommunications Enterprises, which was promulgated by the State Council on December 11, 2001 and was last amended on February 6, 2016. The regulations require foreign-invested value-added telecommunications enterprises in China to be established as Sino-foreign equity joint ventures, and the foreign investors may acquire up to 50% of the equity interests of such enterprise. In addition, the main foreign investor who invests in a foreign-invested value-added telecommunications enterprise operating the value-added telecommunications business in China must demonstrate a good track record and experience in operating a value-added telecommunications business; the main foreign investor is defined as the one who makes the largest contribution among all foreign investors and has a share of 30% or more of the total amount invested by all foreign investors. Moreover, foreign investors that meet these requirements must obtain approvals from MIIT and MOFCOM, or their authorized local counterparts, which retain considerable discretion in granting approvals, for the commencement of value-added telecommunication business of that investor in China.

According to the Circular of Ministry of Information Industry on Strengthening the Administration of Foreign Investment in Value-Added Telecommunication Services, which took effect on July 13, 2006, a foreign investor that invests in telecommunications services within the territory of China shall, in strict accordance with the Provisions, apply for establishing a foreign-funded telecommunication enterprise and a corresponding license for telecommunications operation. A foreign investor that fails to go through the said procedures subject to relevant laws may not make any investment in the telecommunications business within the territory of China.

In accordance with the Provisional Measures for the Administration of Online Games (the “Provisional Measures for Online Games”), which took effect on August 1, 2010 and was last amended on December 15, 2017, an applicant shall obtain an Online Culture Operating License to engage in business activities involving the operation of online games. On July 10, 2019, the MOCT issued the Decision of the Ministry of Culture and Tourism

of the PRC on Abolishing the Provisional Measures for the Administration of Online Games and the Measures for Planning and Administration of Tourism Development, which specifies that the Provisional Measures for Online Games was abolished by the MOCT on July 10, 2019.

The Notice on Regulating Online Game Operation and Strengthening Interim and Ex Post Supervision (the “Notice”), which took effect on May 1, 2017, sets the following requirements in relation to online games: (i) clarifying the scope of online game operation; (ii) regulating services for issuance of virtual props of online games; (iii) strengthening the protection of the rights and interests of online game users; (iv) strengthening the interim and ex-post supervision of online game operation; and (v) seriously investigating and punishing illegal operating activities. The Notice further clarifies the business scope of online games: (i) the supply of online game products and services by online game operators to the public by opening online game user registration or providing online game download services with financial gain obtained from charging online game users or from e-commerce, advertising and sponsorship; (ii) the online game testing conducted by an online game operator by opening user registration or online game charging system, or providing client-side apps which can be used for direct registration and login of its server is deemed as online game operation; (iii) where an online game operator provides user system, charging system, program download, promotion and other services for the online game products of other operators, and participates in distributing the operational gains of such online games, it is deemed as having carried out online game co-operating, and shall undertake the corresponding responsibilities. Besides, the Notice requires the local culture authorities and cultural market comprehensive law enforcement agencies to strengthen the operation supervision on, the credit supervision on and the guidance, service and training for, the online game operators. The principle of punishment on the penalizing illegal behaviour of online game co-operating enterprises is also regulated in the Notice. On August 19, 2019, the MOCT issued the Announcement on the Results of Clearing Administrative Normative Documents, which specifies that the Notice was abolished by the MOCT.

The Advertising Law of the PRC (the “Advertising Law”), which took effect on February 1, 1995 and was last amended on October 26, 2018, regulates contents of advertisements, codes of conduct for advertisers, and the supervision and administration of the advertising industry. It also stipulates that advertisers, advertising operators, and advertisement publishers shall abide by the Advertising Law and other laws and regulations, be honest and trustworthy, and compete in a fair manner in advertising business.

According to the Advertising Law, if advertising operators know or should have known the content of the advertisements is false or deceptive but still provide advertising design, production and agency services in connection with the advertisement, they might be subject to penalties, including confiscation of revenue and fines, and the competent PRC authority may suspend or revoke their business licenses.

The Interim Measures for the Administration of Internet Advertising (the “Interim Measures on Internet Advertising”), which took effect on September 1, 2016, regulate advertising activities conducted via the internet. According to the Interim Measures on Internet Advertising, advertisements published or distributed via the internet shall not interfere with users’ normal use of the internet. For example, advertisements published on web page pop-up windows or in others forms shall be clearly marked with a “close” sign to ensure a “Click to close”. No entity or individual may induce users to click on the contents of an advertisement through deception. An internet advertisement publisher or advertising operator shall establish and maintain an acceptable registration, examination and file management system for its advertisers; examine, verify and record the identity information of each advertiser. The Interim Measures on Internet Advertising also require internet advertisement publishers and advertising operators to verify related supporting documents, check the contents of the advertisement and prohibits them from designing, producing, providing services or publishing any advertisement if the content and supporting documents do not match each other or the documentary evidence thereof are insufficient.

Laws and Regulations Relating to Information Security and Privacy Protection

Internet content in the PRC is regulated and restricted from a state security standpoint. The Standing Committee of the National People’s Congress (the “SCNPC”) enacted the Decisions on the Maintenance of Internet Security, which took effect on December 28, 2000 and was last amended on August 27, 2009, to subject persons to criminal liabilities in the PRC for any attempt to (i) gain improper entry to a computer or system of strategic importance; (ii) disseminate politically disruptive information; (iii) leak state secrets; (iv) spread false commercial

information; or (v) infringe intellectual property rights. The Administration Measures on the Security Protection of Computer Information Network with International Connections, which took effect on December 30, 1997 and was last amended on January 8, 2011, prohibit using the internet in ways which, among others, result in a leakage of state secrets or a spread of socially destabilizing content. The Provisions on the Technical Measures for the Protection of the Security of the Internet, which was promulgated by the MPS and took effect on March 1, 2006, require internet service providers to take proper measures including anti-virus, data back-up and other related measures, to keep records of certain information about its users (including users registration information, log-in and log-out time, IP address, content and time of posts by users) for at least 60 days, and to detect illegal information, stop transmission of such information, and keep relevant records. If an internet information service provider violates these measures, the MPS and the local security bureaus may revoke its operating license and shut down its website. In accordance with the Circular of the Ministry of Public Security, the State Secrecy Bureau, the State Cipher Code Administration and The Information Office of the State Council on Printing and Distributing the Administrative Measures for the Graded Protection of Information Security which took effect on June 22, 2007, the security protection grade of an information system may be classified into the five grades. To newly build an information system of Grade II or above, its operator or user shall, within 30 days after it is put into operation, handle the record-filing procedures at the local public security organ at the level of municipality divided into districts or above of its locality.

On December 28, 2012, the SCNPC promulgated the Decision on Strengthening Network Information Protection to enhance the legal protection of information security and privacy on the internet. On July 16, 2013, the MIIT promulgated the Provisions on Protection of Personal Information of Telecommunication and Internet Users, which took effect on September 1, 2013, to regulate the collection and use of users’ personal information in the provision of telecommunication services and internet information services in PRC and the personal information includes a user’s name, birth date, identification card number, address, phone number, account number, password and other information that can be used for identifying a user and time and place the user uses the aforementioned service. Telecommunication business operators and internet service providers are required to establish its own rules for collecting and use of user’s information and cannot collect or use users’ information without users’ consent. Telecommunication business operators and internet service providers are prohibited from disclosing, tampering with, damaging, selling or illegally providing others with, collected personal information. Several Provisions on Regulation of the Market Order of Internet Information Service, which took effect on March 15, 2012, stipulate that without the consent of users, internet information service providers shall not collect information relevant to the users that can lead to the recognition of the identity of the users independently or in combination with other information, nor shall they provide personal information of users to others, unless otherwise provided by laws and administrative regulations.

In accordance with the Cyber Security Law of the PRC, which took effect on June 1, 2017, network operators shall comply with relevant laws and regulations and fulfill their obligations to safeguard security of the network when conducting business and providing services. Those who provide services through networks shall take technical measures and other necessary measures pursuant to laws, regulations and compulsory national requirements to safeguard the safe and stable operation of the networks, respond to network security incidents effectively, prevent illegal and criminal activities, and maintain the integrity, confidentiality and usability of network data, and the network operator shall not collect the personal information irrelevant to the services it provides or collect or use the personal information in violation of the provisions of laws or agreements between both parties, and network operators of key information infrastructure shall store within the territory of the PRC all the personal information and important data collected and produced within the territory of the PRC. The purchase of network products and services that may affect national security shall be subject to national cyber security review. The Measures for Cybersecurity Review, which took effect on June 1, 2020, provide for more detailed rules regarding cyber security review requirements. Pursuant to the Cybersecurity Review Measures, operators of critical information infrastructure must pass a cybersecurity review when purchasing network products and services which do or may affect national security. On July 10, 2021, the Cyberspace Administration of China issued a revised draft of the Measures for Cybersecurity Review for public comments (“Draft Measures”), which required that, in addition to “operator of critical information infrastructure,” any “data processor” carrying out data processing activities that affect or may affect national security should also be subject to cybersecurity review, and further elaborated the factors to be considered when assessing the national security risks of the relevant activities, including, among others, (i) the risk of core data, important data or a large amount of personal information being stolen, leaked, destroyed, and illegally used or exited the country; and (ii) the risk of critical information infrastructure, core data, important data or a large amount of personal information being affected, controlled, or maliciously used by foreign governments after listing abroad. The Cyberspace Administration of China has said that under the proposed rules companies holding data on more than 1,000,000 users must now apply for cybersecurity approval when seeking listings in other nations

because of the risk that such data and personal information could be “affected, controlled, and maliciously exploited by foreign governments.” The cybersecurity review will also investigate the potential national security risks from overseas IPOs.

On May 8, 2017, the Supreme People’s Court and the Supreme People’s Procuratorate released the Interpretations of the Supreme People’s Court and the Supreme People’s Procuratorate on Several Issues Concerning the Application of Law in the Handling of Criminal Cases Involving Infringement of Citizens’ Personal Information (the “Interpretations”), which took effect on June 1, 2017. The Interpretations clarify several concepts regarding the crime of “infringement of citizens’ personal information” stipulated by Article 253A of the Criminal Law of the People’s Republic of China, including “citizen’s personal information”, “provision”, and “unlawful acquisition”. Also, the Interpretations specify the standards for determining “serious circumstances” and “particularly serious circumstances” of this crime.

On August 20, 2021, the Standing Committee of the NPC approved the Personal Information Protection Law (“PIPL”), which will become effective on November 1, 2021. The PIPL curbs collection of personal identifiable information and seeks to address the issue of algorithmic discrimination. Violations of the PIPL may result in warnings and forced corrections, confiscation of corresponding income, suspension of related services, and fines.

Pursuant to the Trademark Law of the PRC which was last amended on April 23, 2019 and subsequently enforced on November 1, 2019, and the Implementation Rules of the PRC Trademark Law which was last amended on April 29, 2014 and subsequently enforced on May 1, 2014, a registered trademark means a trademark that has been approved by and registered with the trademark office, including goods trademarks, service trademarks, collective trademarks and certification trademarks. Twelve months prior to the expiration of the 10-year term, an applicant can renew its trademarks and reapply for trademark protection. A registered trademark is valid for 10 years commencing on the date of registration approval and renewal shall be made within 12 months before the expiration. If such an application cannot be filed within that period, an extension period of six months may be granted. To license a registered trademark, the licensor should file the licensing documents of the licensed trademark with the trademark bureau, and the trademark bureau shall gazette the licensing. Non-filing of the licensing of a trademark shall not be contested against a good faith third party. The following acts shall constitute infringement of the exclusive right to use a registered trademark: (1) using a trademark that is identical or similar to a registered trademark of the same type of commodities or similar commodities without a license from the registrant of that trademark; (2) selling commodities that infringe upon the exclusive right to use a registered trademark; (3) forging or manufacturing without authorization the marks of a registered trademark, or selling marks of a registered trademark that are forged or manufactured without authorization; (4) changing another party’s registered trademark and putting the commodities with the changed trademark into the market without the consent of the holder of that trademark; or (5) other conduct that would hinder another party’s exclusive right to use its registered trademark.

In accordance with the Patent Law of the PRC, which was last amended December 27, 2008 and subsequently enforced on October 1, 2009 and the Implementation Rules for the Implementation of the Patent Law of the PRC, which was last amended on January 9, 2010 and subsequently enforced on February 1, 2010, patent is divided in to 3 categories, i.e., invention patent, design patent and utility model patent. The duration of the invention patent right is 20 years, and the duration of the design patent right and utility model patent right is 10 years, which shall begin from the date of filing. An individual or entity who uses patent without the license of the patent holder, counterfeits patent products or engages in patent infringement activities shall be held liable for compensation to the patent holder and may be imposed a fine, or even subject to criminal liabilities.

According to the Copyright Law of the PRC, which took effect on June 1, 1991, and was last amended November 11, 2020 and subsequently enforced on June 1, 2021, copyright includes computer software, and the Copyright Protection Centre of China provide a voluntary register system for copyright.

According to the Regulation on Computer Software Protection, which took effect on October 1, 1991 and was last amended on January 30, 2013 and subsequently enforced on March 1, 2013, the software copyright shall exist from the date on which its development has been completed, and software copyright owner may register with the software registration institution recognized by the copyright administration department of the State Council. On February 20, 2002, the National Copyright Administration of the PRC issued the Measures on Computer Software Copyright Registration, which outlines the operational procedures for registration of software copyright, as well as registration of the license for the software copyright and software copyright transfer contracts. The Copyright Protection Center of the PRC is mandated as the software registration agency under the regulations.

In accordance with the Measures for the Administration of Internet Domain Names, which took effect on November 1, 2017 and the Implementation Rules on Registration of National Domain Names, the Measures on Dispute Resolution of National Domain Names, the Proceeding Rules on Dispute Resolution of National Domain Names, which took effect on June 18, 2019, domain name registrations are handled through domain name service agencies established under the relevant regulations, and the applicants become domain name holders upon successful registration.

In accordance with the Labor Law of the PRC, which was last amended on December 29, 2018, and the Labor Contract Law of the PRC, which took effect on January 1, 2008 and was last amended on December 28, 2012 and subsequently enforced on July 1, 2013, and the Implementation Regulation of the Labor Contract Law of the PRC which took effect on September 18, 2008, labor contracts in written form shall be executed to establish labor relationships between employers and employees.

Employers shall establish and develop labor rules, regulations and systems according to the PRC laws to protect the rights and ensure the performance of duties of employees, and career development and training systems shall be established. Employers shall also set up and develop the labor safety and health system in strict compliance with the rules and standards of labor safety and sanitation of the PRC and provide education on labor safety and sanitation for the employees to prevent work-related accidents and occupational harm.

Laws and Regulations Relating to Social Insurance and Housing Provident Fund

In accordance with the Law of Social Insurance of the PRC which took effect on July 1, 2011 and was last amended on December 29, 2018, the Provisional Regulation on the Collection and Payment of Social Insurance Premiums which took effect on January 22, 1999 and was last amended on March 24, 2019, the Decision of the State Council on the Establishment of Basic Medical Insurance System for Urban Workers which took effect on December 14, 1998, the Decisions of the State Council on the Establishment of Unified System of Basic Retirement Insurance Fund for the Employees of Enterprises which took effect on July 16, 1997, the Regulations of Insurance for Work-Related Injury which was amended on December 20, 2010 and subsequently enforced on January 1, 2011, the Regulations of Insurance for Unemployment which took effect on January 22, 1999, the Provisional Insurance Measures for Maternity of Employees which took effect on January 1, 1995 and the Regulations on Management of Housing Provident Fund which took effect on April 3, 1999 and was last amended on March 24, 2019, employers shall make payments of the basic medical insurance, basic retirement insurance, insurance for work-related injury, unemployment insurance, maternity insurance and housing provident fund for the employees.

If the employer fails to file the registration for social insurance, the social insurance administration authority shall order it to make rectification within a prescribed time limit. If rectification is not made within the prescribed time limit, the employer will be imposed a fine. If the employer does not pay the full amount of the Social Insurance as scheduled, the social insurance collection institution shall order it to pay within a prescribed time limit together with a late fee. If the payment including the late fee is not settled by the prescribed time limit, the employer will be

imposed a fine. If the employer fails to file the registration for the housing provident fund, the housing provident fund administration center shall order the employer to pay the amount of the housing provident fund as specified under the relevant laws and regulations within a prescribed time limit, and if the employer still fails to pay up within the prescribed time limit, the fund administration center may apply to the court for enforcement of the unpaid amount.

According to the Reform Scheme of Tax Collection and Management System of State Tax and Local Tax which took effect on July 20, 2018, the social insurance collection and management authority was to be transferred from the Ministry of Human Resources and Social Security to the SAT from January 1, 2019. On September 18, 2018, the general meeting of State Council announced that the policies for social insurance shall remain unchanged until the transfer of the authority for social insurance has been completed. On September 21, 2018, the Ministry of Human Resources and Social Security released an Urgent Notice on Enforcing the Requirement of the General Meeting of the State Council and Stabilization the Levy of Social Insurance Payment and required that the policies for both the rate and basis of social insurance contributions shall remain unchanged until the reform on the transfer of the authority for social insurance has been completed. On November 16, 2018, the SAT released the Notice of Certain Measures on Further Supporting and Serving the Development of Private Economy, which provided that the policy for social insurance shall remain stable and the SAT will pursue to lower the social insurance contribution rates with the relevant authorities, and ensure the overall burden of social insurance contribution on enterprises will be lowered.

In accordance with the EIT Law, which took effect on January 1, 2008 and was last amended on December 29, 2018 and the Implementation Regulation for the Enterprise Income Tax Law of the PRC which took effect on January 1, 2008 and was last amended on April 23, 2019 (collectively, the “EIT Laws”), taxpayers consist of resident enterprises and non-resident enterprises. Resident enterprises are defined as enterprises that are established in China in accordance with the PRC laws, or that are established in accordance with the laws of foreign countries (or regions) but whose actual or de facto control entity is within the PRC. Non-resident enterprises are defined as enterprises that are set up in accordance with the laws of foreign countries (or regions) and whose actual administration is conducted outside the PRC, but (i) have entities or premises in China, or (ii) have no entities or premises in China but have income generated from China. According to the EIT Laws, foreign invested enterprises in the PRC are subject to corporate income tax at a uniform rate of 25%. For a non-resident enterprise having no office or establishment inside China, or for a non-resident enterprise whose incomes have no actual connection to its institution or establishment inside China, a withholding tax of 10% will be levied for the income derived from China.

The Notice Regarding the Determination of Chinese-Controlled Offshore Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies promulgated by the SAT and last amended on December 29, 2017 sets out the standards and procedures for determining whether the “de facto management body” of an enterprise registered outside of the PRC and controlled by PRC enterprises or PRC enterprise groups is located within the PRC.

In accordance with the EIT Laws, a high-tech enterprise which has independent intellectual property rights and complies with the rules of corporate income tax and other relevant laws and regulations enjoys a reduced corporate income tax rate of 15%. The specific standards and procedures for the management of identification of high-tech enterprises are stipulated in the Measures for the Administration of the Certification of High-tech Enterprises which were jointly issued by the Ministry of Science and Technology, the MOF and the SAT on April 14, 2008, took retroactive effect on January 1, 2008 and were amended on January 29, 2016, took retroactive effect on January 1, 2016.

Pursuant to the EIT Laws, income from equity investment between qualified PRC resident enterprises such as dividends and bonuses, which refers to investment income derived by a resident enterprise from its direct investment in another resident enterprise, is tax-exempt.

In addition, pursuant to the Arrangement between Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income which took effect in the PRC on January 1, 2007, a the PRC resident enterprise which distributes dividends to its Hong Kong shareholders should pay income tax according to the PRC law. However, if the beneficiary of the dividends is a Hong Kong resident enterprise, which directly holds no less than 25% equity interests of the aforesaid enterprise (i.e. the dividend distributor), the tax levied shall be 5% of the distributed dividends.

Pursuant to the Circular of the State Administration of Taxation on Relevant Issues relating to the Implementation of Dividend Clauses in Tax Agreements which took effect on February 20, 2009, all of the following requirements shall be satisfied in order to enjoy the preferential tax rates provided under the tax agreements: (i) the tax resident that receives dividends should be a company as provided in the tax agreement; (ii) the equity interests and voting shares of the PRC resident company directly owned by the tax resident reach the percentages specified in the tax agreement; and (iii) the equity interests of the Chinese resident company directly owned by such tax resident at any time during the twelve months prior to receiving the dividends reach a percentage specified in the tax agreement. On February 3, 2018, the SAT issued the Notice on Certain Issues regarding Beneficial Owner in Tax Treaties which took effect on April 1, 2018 provides clearer guidelines and adopts comprehensive assessment approaches when determining whether a company can be qualified as Beneficial Owner, so as to enjoy the preferential tax rate on dividends.

Pursuant to Notice on Widening the Applicable Scope of the Policy of Temporary Exemption of Withholding Taxes on the Direct Investment Made by Overseas Investors with Distributed Profits which took effect on January 1, 2018, where the profits distributed by a resident enterprise within the territory of China to an overseas investor are directly invested in an investment project which is not in the prohibited category and is in conformity with the specified conditions, the project shall be governed by the deferred tax payment policy and be temporarily exempt from withholding income tax.

According to the Provisional Regulations on Value-added Tax of the PRC which took effect on January 1, 1994 and was last amended on November 19, 2017, and the Provisional Implementation Rules of the Provisional Regulations on Value-added Tax of the PRC which was last amended on October 28, 2011 and subsequently enforced on November 1, 2011, all enterprises and individuals that engage in the sale of goods, the provision of processing, repair and replacement services, and the importation of goods within the territory of the PRC shall pay VAT. According to the Circular on Comprehensively Promoting the Pilot Program of the Collection of VAT in Lieu of Business Tax, which took effect on May 1, 2016, the pilot practice of levying VAT in lieu of business tax was extended nationwide to the sale of services, intangible assets or property.

According to the Circular of the Ministry of Finance (the “MOF”) and SAT on Adjusting Value-added Tax Rates which took effect on May 1, 2018, where a taxpayer engages in a taxable sales activity for the VAT purpose or imports goods, the previous applicable 17% and 11% tax rates are adjusted to be 16% and 10% respectively, and are further adjusted to be 13% and 9% respectively in accordance with the Announcement of the MOF, the SAT and the General Administration of Customs on Deepening the Policies Related to Value-Added Tax Reform which took effect on April 1, 2019.

In accordance with the Provisional Provisions on the Collection of Educational Surtax, which was last amended on January 8, 2011, all entities and individuals who pay consumption tax, VAT and business tax shall also be required to pay educational surtax. The educational surtax rate is 3% of the amount of VAT, business tax and consumption tax actually paid by each entity or individual, and the educational surtax shall be paid simultaneously with VAT, business tax and consumption tax. In accordance with the Provisional Regulations on Urban Maintenance and Construction Tax of the PRC which was last amended on January 8, 2011 and Circular of the State Administration of Taxation on Issues Concerning the Collection of the Urban Maintenance and Construction Tax, which took effect on March 12, 1994, any entity or individual liable to consumption tax, VAT and business tax shall also be required to pay urban maintenance and construction tax. Payment of urban maintenance and construction tax shall be based on the consumption tax, VAT and business tax which a taxpayer actually pays and shall be made simultaneously when the latter are paid. The rates of urban maintenance and construction tax shall be 7%, 5% and 1% for a taxpayer in a city, in a county town or town and in a place other than a city, county town or town respectively.

In accordance with the Foreign Exchange Administrative Regulations of the PRC which was last amended on August 5, 2008, Renminbi is generally freely convertible for payments of current account items, such as trade and service-related foreign exchange transactions and dividend payments, but are not freely convertible for capital account items, such as capital transfer, direct investment, investment in securities, derivative products or loans unless prior approval/registration of the SAFE is obtained.

In accordance with the Administration Rule on the Settlement and Sale of and Payment in Foreign Exchange, which took effect on July 1, 1996, a foreign invested enterprise is allowed to process the settlement and sale of and payment in foreign exchange for capital account items after submitting valid commercial documents and getting approval from the SAFE. According to the Circular 13, which took effect on June 1, 2015, certain of the aforementioned approval rights of the SAFE are authorized to designated banks.

Pursuant to the Circular 19 which took effect on June 1, 2015, and the Notice of the State Administration of Foreign Exchange on Reforming and Standardizing the Administrative Provisions on Capital Account Foreign Exchange Settlement which took effect on June 9, 2016, whose main business is investment, are allowed to make equity investment in PRC using the Renminbi funds converted from its registered capital. Meanwhile, the use of such Renminbi funds converted cannot be:

In October 2019, the SAFE released the Notice on Further Promoting the Facilitation of Cross-border Trade and Investment, which, among others, cancelled the restrictions on the domestic equity investment by non-investment foreign-funded enterprises with their capital funds and non-investment foreign-funded enterprises are allowed to make domestic equity investment with their capital funds in accordance with the law on the premise that the existing special administrative measures (Negative List) for foreign investment access are not violated and the projects invested thereby in China are true and legitimate.

In addition, foreign invested enterprises are allowed to settle foreign exchange capitals on a discretionary basis; the foreign invested enterprises may, according to its actual business needs, settle with a bank the portion of the foreign exchange capital in its capital account for which the relevant foreign exchange bureau has confirmed monetary contribution rights and interests (or for which the bank has registered the account-crediting of monetary contribution). For the time being, foreign invested enterprises are allowed to settle 100% of their foreign exchange capitals on a discretionary basis. The SAFE may adjust the foregoing percentage as appropriate based on prevailing international balance of payments.

In accordance with the Circular 37 which took effect on July 4, 2014, a “special purpose vehicle” means an overseas enterprise directly established or indirectly controlled by a domestic resident (including domestic institutions and domestic individual residents) for the purpose of engaging in investment and financing with the domestic enterprise assets or interests he legally holds, or with the overseas assets or interests he legally holds. Domestic residents establishing or taking control of a special purpose vehicle abroad which makes round-trip investments in PRC are required to file foreign exchange registration with the local foreign exchange bureau. According to the Circular of the State Administration of Foreign Exchange on Further Simplifying and Improving the Direct Investment-related Foreign Exchange Administration Policies, the initial foreign exchange registration for establishing or taking control of a special purpose company by domestic residents can be filed with a designated bank, instead of the local foreign exchange bureau.

Pursuant to the Circular on Further Improving Reform of Foreign Exchange Administration and Optimizing Genuineness and Compliance Verification (the “Circular 3”) which took effect on January 26, 2017, stipulates several capital control measures with respect to the outbound remittance of profit from domestic entities to offshore

entities, including (i) under the principle of genuine transaction, banks shall check board resolutions regarding profit distribution, the original version of tax filing records and audited financial statements; and (ii) domestic entities shall hold income to account for previous years’ losses before remitting profits. Moreover, pursuant to SAFE Circular 3, domestic entities shall make detailed explanations of the sources of capital and utilization arrangements, and provide board resolutions, contracts and other proof when completing the registration procedures in connection with an outbound investment.

As of the Latest Practicable Date, the ultimate individual shareholder of VIYI had completed the foreign exchange registrations pursuant to Circular 37 and Circular 13 in relation to this shareholder’s offshore investments as PRC residents.

The Administrative Measures for Overseas Investment Management was promulgated by the MOFCOM on September 6, 2014 and came into effect on October 6, 2014. As defined by the Measures for Overseas Investment Management, overseas investment means that the enterprises legally incorporated in the PRC own the non-financial enterprises or obtain the ownership, control and operation management rights of the existing non-financial enterprises in foreign countries through incorporation, merger and acquisition and other means. If the overseas investments involve sensitive countries and regions or sensitive industries, they shall be subject to the approval of competent authorities. For other overseas investments, they shall be subject to filing administration. Local enterprises shall be filed with the provincial commercial administration authorities where they are located. The qualified enterprises will be put into record and granted with Overseas Investment Certificate for Enterprise by the relevant provincial commercial administration authorities.

On December 26, 2017, NDRC issued the Administrative Measures for the Overseas Investment of Enterprises, which took effect on March 1, 2018. Under the Measures, sensitive overseas investment projects carried out by PRC enterprises either directly or through overseas enterprises under their control shall be approved by NDRC, and non-sensitive overseas investment projects directly carried out by PRC enterprises shall be filed with NDRC or its local branch at provincial level. In the case of the large-amount non-sensitive overseas investment projects with the investment amount of USD$ 300 million or above carried out by PRC enterprises through the overseas enterprises under their control, such PRC enterprises shall, before the implementation of the projects, submit a report describing the details about such large-amount non-sensitive projects to NDRC. Where the PRC resident natural persons make overseas investments through overseas enterprises under their control, the Measures shall apply mutatis mutandis. Subsequently on January 31, 2018, NDRC issued the Catalogue of Sensitive Overseas Investment Industry (2018 Version) effective from March 1, 2018 under which enterprises shall be restricted from making overseas investments in certain industries including without limitation real estate and hotel.

As of the Latest Practicable Date, the ultimate PRC corporate shareholders of VIYI, had completed the overseas direct investment registration with the local MOFCOM and NDRC pursuant to the Overseas Direct Investment Rules in relation to their offshore investments as domestic enterprises.

The principal law governing dividend distributions by VIYI’s PRC Subsidiaries is the PRC Company Law, while the dividend distribution by wholly foreign-owned enterprises (“WFOE”) is further governed by Foreign Investment Law and its implementation regulations. According to the above laws and regulations, Chinese companies (including foreign-owned enterprises) may only pay dividends based on the accumulated profits calculated in accordance with PRC accounting principles.

In addition, in accordance with the PRC Company Law, when a company distributes their after-tax profits for a given year, they shall allocate 10% of after-tax its profits to their statutory common reserve. Companies shall no longer be required to make allocations to their statutory common reserve once the aggregate amount of such reserve exceeds 50% of their registered capital unless the provisions of laws regarding foreign investment otherwise provided. If a company’s statutory common reserve is insufficient to make up its losses of the previous years, such losses shall be made up from the profit for the current year prior to making allocations to the statutory common reserve pursuant to the preceding paragraph. Such reserved cash cannot be distributed as cash dividends.

In August 2019, Venus sponsor purchased 1,150,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.02 per share. Venus sponsor owns approximately 22.73% of its issued and outstanding shares after its IPO.

Venus’ sponsor (and/or its designees) purchased an aggregate of 225,000 private placement units at a price of $10.00 per unit in a private placement that will close simultaneously with the closing of the IPO on February 11, 2021. Each unit consists of one private placement share, one private placement right granting the holder thereof the right to receive one-tenth (1/10) of an ordinary share upon the consummation of a business combination, and one private placement warrant. Each private placement warrant entitles the holder upon exercise to purchase one-half of one ordinary share at a price of $11.50 per whole share, subject to adjustment as provided herein. The private placement units (including the underlying securities) may not, subject to certain limited exceptions, be transferred, assigned or sold by it until 30 days after the completion of the Business Combination.

Venus entered into an Administrative Services Agreement with Yolanda Management Corporation, an affiliate of Venus’ sponsor, pursuant to which Venus will pay a total of $10,000 per month for office space, administrative and support services to such affiliate. Upon completion of the Business Combination or Venus’ liquidation, Venus will cease paying these monthly fees. Accordingly, in the event the consummation of the Business Combination takes the maximum 21 months, an affiliate of Venus’ sponsor will be paid a total of $210,000 ($10,000 per month) for office space, administrative and support services and will be entitled to be reimbursed for any out-of-pocket expenses.

Venus’ sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on Venus’ behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Venus’ audit committee will review on a quarterly basis all payments that were made to Venus’ sponsor, officers, directors or Venus’ or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on Venus’ behalf.

Venus’ sponsor had previously agreed to loan Venus up to $450,000 to be used for formation and offering expenses. As of December 31, 2020, the amount owed to Venus’ sponsor was $228,483. These loans were non-interest bearing, unsecured and were due at the earlier of December 31, 2021 or the closing of the IPO. Venus repaid the sum of $262,250 to Venus’ sponsor at the completion of the IPO on February 11, 2021.

In order to finance transaction costs in connection with an intended business combination, Venus’ sponsor or an affiliate of Venus’ sponsor or certain of its officers and directors may, but are not obligated to, loan Venus funds as may be required. If Venus completes an business combination, it would repay such loaned amounts. In the event that the Business Combination does not close, Venus may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from Venus’ trust account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit (which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were so converted (including 15,000 shares upon the closing of the Business Combination in respect of 150,000 rights included in such units), as well as 150,000 warrants to purchase 75,000 shares) at the option of the lender. The units would be identical to the placement units issued to the holder. The terms of such loans by Venus’ officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. Venus does not expect to seek loans from parties other than Venus’ sponsor or an affiliate of Venus’ sponsor as Venus does not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in Venus’ trust account. As of [__] no advance of funds has been made.

In May 2018, the Company issued one ordinary share to the Sponsor for no consideration. On August 21, 2019, the Company cancelled the one share for no consideration and the Sponsor purchased 1,150,000 ordinary shares for an aggregate price of $25,000.

The 1,150,000 founder shares (for purposes hereof referred to as the “Founder Shares”).

Venus’ founders and its officers and directors have agreed not to transfer, assign or sell any of the Founder Shares (except to certain permitted transferees) until, with respect to 50% of the Founder Shares, the earlier of (i) six months after the date of the consummation of a Business Combination, or (ii) the date on which the closing price of the Company’s ordinary shares equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after a Business Combination, with respect to the remaining 50% of the Founder Shares, upon six months after the date of the consummation of a Business Combination, or earlier, in each case, if, subsequent to a Business Combination, the Company consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s shareholders having the right to exchange their ordinary shares for cash, securities or other property.

As of December 31, 2021 and 2020, the Sponsor had advanced the Company an aggregate of $373,421 and $26,750, respectively. The advances are non-interest bearing and due on demand.

On June 10, 2019, as amended on January 16, 2020, the Company issued an unsecured promissory note to the Sponsor, pursuant to which the Company may borrow up to an aggregate principal amount of $450,000 (the “Promissory Note”). The Promissory Note is non-interest bearing and payable on the earlier of (i) December 31, 2021 or (ii) the consummation of the Initial Public Offering (see Note 4). The outstanding balance under the Promissory Note was repaid at the closing of the Initial Public Offering on February 11, 2021. As of December 31, 2021 and 2020, the principal amount due and owing under the Promissory Note was $0 and $228,483 respectively.

An affiliate of the Sponsor agreed, commencing on February 8, 2021 through the earlier of the Company’s consummation of a Business Combination and its liquidation, to make available to the Company certain general and administrative services, including office space, utilities and administrative services, as the Company may require from time to time. The Company has agreed to pay the affiliate of the Sponsor $10,000 per month for these services.

In order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor or an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of notes may be converted upon consummation of a Business Combination into additional Private Units at a price of $10.00 per Unit. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. As of December 31, 2021 no advance of funds has been made.

As discussed in Note 1, the Company may extend the period of time to consummate a Business Combination up to nine times, each by an additional month (for a total of 21 months to complete a Business Combination). In order to extend the time available for the Company to consummate a Business Combination, the Sponsor or its affiliates or designees must deposit into the Trust Account $153,333 (approximately $0.033 per Public Share), up to an aggregate of $1,380,000, or $0.30 per Public Share, on or prior to the date of the applicable deadline, for each one month extension. Any such payments would be made in the form of a loan. The terms of the promissory note to be issued in connection with any such loans have not yet been negotiated. If the Company completes a Business Combination, the Company would repay such loaned amounts out of the proceeds of the Trust Account released to the Company. If the Company does not complete a Business Combination, the Company will not repay such loans. Furthermore, the letter agreement with the shareholders contains a provision pursuant to which the Sponsor has

agreed to waive its right to be repaid for such loans in the event that the Company does not complete a Business Combination. The Sponsor and its affiliates or designees are not obligated to fund the Trust Account to extend the time for the Company to complete a Business Combination.

Venus has adopted a code of ethics requiring it to avoid, wherever possible, all conflicts of interests, except under guidelines or resolutions approved by Venus’ Board of Directors (or the appropriate committee of Venus’ board) or as disclosed in Venus’ public filings with the SEC. Under Venus’ code of ethics, conflict of interest situations will include any financial transaction, arrangement or relationship (including any indebtedness or guarantee of indebtedness) involving the company. A form of the code of ethics was filed as an exhibit to the registration statement for the IPO as filed with the SEC.

In addition, Venus’ audit committee, pursuant to its written charter, will be responsible for reviewing and approving related party transactions to the extent that Venus enters into such transactions. An affirmative vote of a majority of the members of the audit committee present at a meeting at which a quorum is present will be required in order to approve a related party transaction. A majority of the members of the entire audit committee will constitute a quorum. Without a meeting, the unanimous written consent of all of the members of the audit committee will be required to approve a related party transaction. A form of the audit committee charter that Venus adopted was filed as an exhibit to the registration statement for the IPO. Venus also requires each of its directors and executive officers to complete a directors’ and officers’ questionnaire that elicits information about related party transactions.

VIYI has not been and will not be a participant in any related party transactions within the meaning of Item 404 of Regulation S-K. Upon the consummation of the Business Combination, New Venus will adopt certain policies and procedures for the review, approval, or ratification of transactions with related parties.

According to the Amended and Restated Memorandum and Articles of Association of New Venus the authorized share capital of post-closing company is $200,000 divided into 200,000,000 ordinary shares of par value of $0.001 each. New Venus’ ordinary shares issued in the Business Combination will be registered at the closing, but will be subject to the lock-up agreements described below. Sales of substantial amounts of New Venus ordinary shares in the public market could adversely affect prevailing market prices of the New Venus ordinary shares. Prior to the Business Combination, there has been no public market for New Venus ordinary shares. New Venus intends to apply for listing of the New Venus ordinary shares and New Venus Warrants on Nasdaq, but it cannot be assured that a regular trading market will develop in the New Venus ordinary shares or New Venus Warrants.

Pursuant to the term of the Business Combination Agreement as described in this Proxy Statement, Venus will be issuing to the shareholders of VIYI Algorithm Inc. (“VIYI”), a Cayman Islands exempted company, an aggregate of 39,603,961 Venus ordinary shares equal to approximately 85.84% of the post transaction ordinary shares issued and outstanding of Venus. All of the ordinary shares to be issued to the VIYI shareholders in connection with the Business Combination will be freely transferable under the Securities Act of 1933 without restriction or further registration under the Securities Act, subject to any lock-up restrictions by virtue of this Proxy Statement, other than those ordinary shares held by VIYI shareholders who will be deemed “affiliates” of Venus as a result of the Business Combination. The number of ordinary shares that will be held by affiliates will equal ______ ordinary shares.

Subject to applicable securities laws in relevant jurisdictions and New Venus’ Amended and Restated Memorandum and Articles of Association, the fully paid-up ordinary shares are freely transferable. Shares may be transferred by a duly signed instrument of transfer in any usual common form or in a form acceptable to the directors and the applicable securities laws in the relevant jurisdictions. The directors may decline to register any transfer unless, among other things, (i) the instrument of transfer is lodged with New Venus, accompanied by the certificate for the shares to which it relates and such other evidence as New Venus’ board of directors may reasonably require to show the right of the transferor to make the transfer, (ii) the instrument of transfer is in respect of only one class of shares; (iii) the instrument of transfer is properly stamped, if required, (iv) in the case of transfer to joint holders, the number of joint holders to whom the share is to be transferred does not exceed four, and (v) a fee of such maximum sum as the relevant stock exchange may determine to be payable or such lesser sum as New Venus’ directors may from time to time require is paid to New Venus. New Venus will replace lost or destroyed certificates for shares upon notice to us and upon, among other things, the applicant furnishing evidence and indemnity as the directors may require and the payment of all applicable fees.

In connection with the transactions, New Venus will enter into a Lock-Up Agreement (the form of which is attached as Exhibit B to the Merger Agreement) with each VIYI shareholder and Venus’ Sponsor, Yolanda Management Corporation, with respect to certain lock-up arrangements, which will provide that such VIYI shareholder and Venus’ Sponsor will not, within certain period of time from the closing of the Business Combination, offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, subject to express carve-outs therein, any of the shares issued in connection with the Business Combination, enter into a transaction that would have the same effect, or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any of the economic consequences of ownership of such shares, whether any of these transactions are to be settled by delivery of any such shares, in cash, or otherwise.

All of New Venus ordinary shares that will be outstanding upon the consummation of the Business Combination, other than those equity shares issued and registered in connection with the Business Combination, are “restricted securities” as that term is defined in Rule 144 under the Securities Act and may be sold publicly in the United States only if they are subject to an effective registration statement under the Securities Act or pursuant to an exemption from the registration requirement such as those provided by Rule 144 and Rule 701 promulgated under the Securities Act. In general, beginning 90 days after the date of this proxy statement, a person (or persons whose shares are aggregated) who, at the time of a sale, is not, and has not been during the three months preceding the sale,

an affiliate of New Venus and has beneficially owned New Venus’ restricted securities for at least six months will be entitled to sell the restricted securities without registration under the Securities Act, subject only to the availability of current public information about New Venus. Persons who are affiliates of New Venus and have beneficially owned New Venus’ restricted securities for at least six months may sell a number of restricted securities within any three-month period that does not exceed the greater of the following:

Sales by affiliates of New Venus under Rule 144 are also subject to certain requirements relating to manner of sale, notice and the availability of current public information about New Venus.

Notwithstanding the foregoing, Rule 144 is not available for the resale of securities initially issued by shell companies (other than business combination related shell companies) or issuers that have been at any time previously a shell company. However, Rule 144 also includes an important exception to this prohibition if the following conditions are met:

We anticipate that following the consummation of the Business Combination, New Venus will no longer be a shell company, and so, once the conditions set forth in the exceptions listed above are satisfied, Rule 144 will become available for the resale of the above noted restricted securities.

In general, under Rule 701 of the Securities Act as currently in effect, each of New Venus’ employees, consultants or advisors who purchases equity shares from New Venus in connection with a compensatory stock plan or other written agreement executed prior to the consummation of the Business Combination is eligible to resell those equity shares in reliance on Rule 144, but without compliance with some of the restrictions, including the holding period, contained in Rule 144. However, the Rule 701 shares would remain subject to lock-up arrangements and would only become eligible for sale when the lock-up period expires.

In connection with the transactions, Venus and VIYI shareholders have entered into a registration rights agreement (the form of which is attached as Exhibit A to the Merger Agreement) as of June 10, 2021, to provide for the resale registration with respect to the shares issued to VIYI shareholders in connection with the Business Combination.

New Venus or Venus is an exempted company incorporated in the Cayman Islands and its affairs are governed by the memorandum and articles of association, as amended and restated from time to time, and Companies Act (As Revised) of the Cayman Islands, which is referred to as the “Companies Act” below, and the common law of the Cayman Islands.

New Venus currently has only one class of issued ordinary shares, which have identical rights in all respects and rank equally with one another. According to the Memorandum and Articles of Association, the authorized share capital of the New Venus is US $200,000 divided into $200,000,000 shares of a par value of US $0.001 each.

The following includes a summary of the terms of New Venus ordinary shares, based on its Memorandum and Articles of Association and Cayman Islands law. Immediately prior to the consummation of the Business Combination, Venus shall amend its memorandum and articles of association, which amendment is referred to herein as the “Share Increase Proposal” to increase the number of authorized New Venus ordinary shares. See the discussion of Proposal 4 of this Proxy Statement.

General. Immediately prior to the consummation of the Business Combination, Venus’ authorized share capital is 6,050,000 Venus ordinary shares, with a par value of $0.001 each. All of Venus’ issued and outstanding ordinary shares are fully paid and non-assessable. Certificates representing the ordinary shares are issued in registered form. Venus may not issue share to bearer. Venus’ shareholders who are non-residents of the Cayman Islands may freely hold and transfer their ordinary shares.

Dividends. The holders of New Venus’ ordinary shares are entitled to such dividends as may be declared by its Board of Directors subject to its Memorandum and Articles of Association and the Companies Act. In addition, New Venus’ shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by its directors. New Venus’ Memorandum and Articles of Association provide that dividends may be declared and paid out of New Venus’ profits, realized or unrealized, or from any reserve set aside from profits which its Board of Directors determine is no longer needed. Dividends may also be declared and paid out of share premium account or any other fund or account which can be authorized for this purpose in accordance with the Companies Act. No dividend may be declared and paid unless New Venus’ directors determine that, immediately after the payment, New Venus will be able to pay its debts as they become due in the ordinary course of business and New Venus has funds lawfully available for such purpose. Holders of New Venus’ ordinary shares will be entitled to the same amount of dividends, if declared.

Voting Rights. In respect of all matters subject to a shareholders’ vote, each New Venus’ ordinary share is entitled to one vote. Voting at any meeting of shareholders is by poll and not on a show of hands.

A quorum required for a meeting of shareholders consists of two or more shareholders holding not less than one-half of the votes attaching to the issued and outstanding shares entitled to vote at general meetings present in person or by proxy or, if a corporation or other non-natural person, by its duly authorized representative. As a Cayman Islands exempted company, New Venus is not obliged by the Companies Act to call shareholders’ annual general meetings. New Venus’ Memorandum and Articles of Association provide that New Venus may (but are not obliged to) in each year hold a general meeting as its annual general meeting in which case New Venus will specify the meeting as such in the notices calling it, and the annual general meeting will be held at such time and place as may be determined by its directors. New Venus, however, will hold an annual shareholders’ meeting during each fiscal year, as required by the Listing Rules at the Nasdaq. Each general meeting, other than an annual general meeting, shall be an extraordinary general meeting. Shareholders’ annual general meetings and any other general meetings of New Venus’ shareholders may be called by a majority of its Board of Directors or its chairman or, in the case of an extraordinary general meeting only, upon a requisition of shareholders holding at the date of deposit of the requisition not less than [one-third] of the votes attaching to the issued and outstanding shares entitled to vote at general meetings, in which case the directors are obliged to call such meeting and to put the resolutions so requisitioned to a vote at such meeting; however, New Venus Memorandum and Articles of Association do not provide its shareholders with any right to put any proposals before any annual general meetings or any extraordinary

general meetings not called by such shareholders. Advance notice of at least [●] days is required for the convening of New Venus’ annual general meeting and other general meetings unless such notice is waived in accordance with its articles of association.

An ordinary resolution to be passed at a meeting by the shareholders requires the affirmative vote of a simple majority of the votes attaching to the ordinary shares cast by those shareholders entitled to vote who are present in person or by proxy at a general meeting, while a special resolution requires the affirmative vote of no less than two-thirds of the votes attaching to the ordinary shares cast by those shareholders entitled to vote who are present in person or by proxy at a general meeting. A special resolution will be required for the Articles Amendment Proposal or making other changes to New Venus’ Memorandum and Articles of Association.

Transfer of ordinary shares. Subject to the restrictions in New Venus’ Memorandum and Articles of Association as set out below, any of New Venus’ shareholders may transfer all or any of his or her ordinary shares by an instrument of transfer in the usual or common form or any other form approved by New Venus’ Board of Directors.

New Venus’ Board of Directors may, in its absolute discretion, decline to register any transfer of any ordinary share which is not fully paid up or on which New Venus has a lien. New Venus’ Board of Directors may also decline to register any transfer of any ordinary share unless:

If New Venus’ directors refuse to register a transfer they shall, within two months after the date on which the instrument of transfer was lodged, send to each of the transferor and the transferee notice of such refusal.

The registration of transfers may, after compliance with any notice required of the Nasdaq, be suspended and the register closed at such times and for such periods as New Venus’ Board of Directors may from time to time determine, provided, however, that the registration of transfers shall not be suspended nor the register closed for more than 30 days in any year as New Venus’ board may determine.

Liquidation. On a return of capital on winding up or otherwise (other than on conversion, redemption or purchase of ordinary shares), if the assets available for distribution amongst New Venus’ shareholders shall be more than sufficient to repay the whole of the share capital at the commencement of the winding up, the surplus shall be distributed amongst New Venus’ shareholders in proportion to the par value of the shares held by them at the commencement of the winding up, subject to a deduction from those shares in respect of which there are monies due, of all monies payable to New Venus for unpaid calls or otherwise. If New Venus’ assets available for distribution are insufficient to repay all of the paid-up capital, the assets will be distributed so that the losses are borne by New Venus’ shareholders in proportion to the par value of the shares held by them. Any distribution of assets or capital to a holder of ordinary share will be the same in any liquidation event.

Redemption, Repurchase and Surrender of ordinary shares. New Venus may issue shares on terms that such shares are subject to redemption, at New Venus’ option or at the option of the holders thereof, on such terms and in such manner as may be determined, before the issue of such shares, by New Venus’ Board of Directors or by a special resolution of New Venus’ shareholders. New Venus may also repurchase any of its shares provided that the manner and terms of such purchase have been approved by its Board of Directors or are otherwise authorized by its Memorandum and Articles of Association. Under the Companies Act, the redemption or repurchase of any share may be paid out of New Venus’ profits or out of the proceeds of a fresh issue of shares made for the purpose of such redemption or repurchase, or out of capital (including share premium account and capital redemption reserve)

if the company can, immediately following such payment, pay its debts as they fall due in the ordinary course of business. In addition, under the Companies Act no such share may be redeemed or repurchased (a) unless it is fully paid up, (b) if such redemption or repurchase would result in there being no shares outstanding, or (c) if the company has commenced liquidation. In addition, New Venus may accept the surrender of any fully paid share for no consideration.

Variations of Rights of Shares. If at any time New Venus’ share capital is divided into different classes or series of shares, the rights attached to any class or series of shares (unless otherwise provided by the terms of issue of the shares of that class or series), whether or not New Venus is being wound-up, may be varied with the consent in writing of a majority the holders of the issued shares of that class or series or with the sanction of an ordinary resolution at a separate meeting of the holders of the shares of the class or series. The rights conferred upon the holders of the shares of any class issued shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by the creation or issue of further shares ranking pari passu with such existing class of shares.

Inspection of Books and Records. Holders of New Venus ordinary shares have no general right under Cayman Islands law to inspect or obtain copies of New Venus’ list of shareholders or its corporate records (save for the Memorandum and Articles, the register of mortgages and charges and any special resolutions of New Venus’ shareholders). However, New Venus will provide its shareholders with annual audited financial statements. See “Where You Can Find Additional Information.”

Issuance of Additional Shares. New Venus’ Memorandum and Articles of Association authorize its Board of Directors to issue additional ordinary shares from time to time as its Board of Directors shall determine, to the extent of available authorized but unissued shares.

New Venus’ Memorandum and Articles of Association also authorize its Board of Directors to establish from time to time one or more series of preferred shares and to determine, with respect to any series of preferred shares, the terms and rights of that series, including:

New Venus’ Board of Directors may issue preferred shares without action by its shareholders to the extent authorized but unissued. Issuance of these shares may dilute the voting power of holders of ordinary shares.

Anti-Takeover Provisions. Some provisions of New Venus’ Memorandum and Articles of Association may discourage, delay or prevent a change of control of New Venus or management that shareholders may consider favorable, including provisions that authorize New Venus’ Board of Directors to issue preferred shares in one or more series and to designate the price, rights, preferences, privileges and restrictions of such preferred shares without any further vote +or action by its shareholders.

Exempted Company. New Venus is an exempted company with limited liability under the Companies Act. The Companies Act distinguishes between ordinary resident companies and exempted companies. Any company that is registered in the Cayman Islands but conducts business mainly outside the Cayman Islands may apply to be registered as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary company except that an exempted company:

“Limited liability” means that the liability of each shareholder is limited to the amount unpaid by the shareholder on that shareholder’s shares of the company.

Under Cayman Islands law, New Venus must keep a register of members and there shall be entered therein:

For these purposes, “voting rights” means rights conferred on shareholders in respect of their shares to vote at general meetings of the company on all or substantially all matters. A voting right is conditional where the voting right arises only in certain circumstances.

Under Cayman Islands law, the register of members of our company is prima facie evidence of the matters set out therein (i.e. the register of members will raise a presumption of fact on the matters referred to above unless rebutted) and a member registered in the register of members shall be deemed as a matter of Cayman Islands law to have legal title to the shares as set against its name in the register of members. Upon the closing of this public offering, the register of members shall be immediately updated to reflect the issue of shares by us. Once our register of members has been updated, the shareholders recorded in the register of members shall be deemed to have legal title to the shares set against their name. However, there are certain limited circumstances where an application may be made to a Cayman Islands court for a determination on whether the register of members reflects the correct legal position. Further, the Cayman Islands court has the power to order that the register of members maintained by a company should be rectified where it considers that the register of members does not reflect the correct legal position. If an application for an order for rectification of the register of members were made in respect of our ordinary shares, then the validity of such shares may be subject to re-examination by a Cayman Islands court.

New Venus’ amended and restated memorandum and articles of association will provide that preference shares may be issued from time to time in one or more series. Our Board of Directors will be authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. Our Board of Directors will be able to, without shareholder approval, issue preference shares with voting and other rights that could adversely affect the voting power and other rights of the holders of the ordinary shares and could have anti-takeover effects. The ability of our Board of Directors to issue preference shares without shareholder approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing management. We

have no preference shares outstanding at the date hereof. Although we do not currently intend to issue any preference shares, we cannot assure you that we will not do so in the future. No preference shares are being issued or registered in this offering.

Set forth below is also a description of the New Venus Warrants that will be issued and outstanding upon the consummation of the Business Combination. These are the same warrants issued and outstanding in connection with Venus’ IPO. Venus is not issuing any warrant to the VIYI shareholders in connection with the Business Combination.

The New Venus Warrants will have the same terms as the Venus Warrants. Each New Venus Warrant entitles the holder thereof to purchase one-half (1/2) of one New Venus Ordinary Share at a price of $11.50 per full share. New Venus will not issue fractional shares. As a result, a warrant holder must exercise its New Venus Warrants in multiples of two, at a price of $11.50 per full share, subject to adjustment, to validly exercise the New Venus Warrants. The New Venus Warrants will become exercisable on the later of the completion of the Business Combination and 12 months from the date of the IPO, and will expire five years after the consummation of the Business Combination.

New Venus may redeem the outstanding New Venus Warrants (excluding the private warrants that are part of the Private Units), in whole and not in part, at a price of $0.01 per warrant:

If the foregoing conditions are satisfied and New Venus issues a notice of redemption, each warrant holder can exercise his, her or its New Venus Warrant prior to the scheduled redemption date. However, the price of the New Venus ordinary shares may fall below the $18.00 trigger price as well as the $11.50 warrant exercise price per full share after the redemption notice is issued and not limit New Venus’ ability to complete the redemption.

If New Venus calls the New Venus Warrants for redemption as described above, New Venus’ management will have the option to require all warrant holders that wish to exercise New Venus Warrants to do so on a “cashless basis.” In such event, each warrant holder would pay the exercise price by surrendering the whole New Venus Warrant for that number of New Venus ordinary shares equal to the quotient obtained by dividing (x) the product of the number of New Venus ordinary shares underlying the New Venus Warrants, multiplied by the difference between the exercise price of the New Venus Warrants and the “fair market value” (as defined below) by (y) the fair market value. The “fair market value” shall mean the average reported last sale price of the New Venus ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the warrant holders. Whether New Venus will exercise its option to require all warrant holders to exercise their New Venus Warrants on a “cashless basis” will depend on a variety of factors including the price of the New Venus ordinary shares at the time the New Venus Warrants are called for redemption, New Venus’ cash needs at such time and concerns regarding dilutive share issuances.

We will not be obligated to deliver any ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the ordinary shares underlying the warrants is then effective and a proxy statement relating thereto is current, subject to our satisfying our obligations described below with respect to registration. No warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption is available. In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In the event that a registration statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid the full purchase price for the unit solely for the ordinary share underlying such unit.

We have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our business combination, we will use our best efforts to file, and within 60 business days following our business combination to have declared effective, a registration statement covering the ordinary shares issuable upon exercise of the warrants. We will use our best efforts to cause the same to become effective and to maintain the effectiveness of such registration statement, and a current proxy statement relating thereto, until the expiration of the warrants in accordance with the provisions of the warrant agreement. No warrants will be exercisable for cash unless we have an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current proxy statement relating to such ordinary shares. Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the warrants is not effective within a specified period following the consummation of our business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis.

If the number of issued and outstanding ordinary shares is increased by a capitalization payable in ordinary shares, or by a sub-division of ordinary shares or other similar event, then, on the effective date of such capitalization, sub-division or similar event, the number of ordinary shares issuable on exercise of each warrant will be increased in proportion to such increase in the issued and outstanding ordinary shares. A rights offering to holders of ordinary shares entitling holders to purchase ordinary shares at a price less than the fair market value will be deemed a capitalization of a number of ordinary shares equal to the product of (i) the number of ordinary shares actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for ordinary shares) multiplied by (ii) one (1) minus the quotient of (x) the price per ordinary share paid in such rights offering divided by (y) the fair market value. For these purposes (i) if the rights offering is for securities convertible into or exercisable for ordinary shares, in determining the price payable for ordinary shares, there will be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) fair market value means the volume weighted average price of ordinary shares as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the ordinary shares trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.

In addition, if we, at any time while the warrants are outstanding and unexpired, pay a dividend or make a distribution in cash, securities or other assets to the holders of ordinary shares on account of such ordinary shares (or other ordinary shares into which the warrants are convertible), other than (a) as described above, (b) certain ordinary cash dividends, (c) to satisfy the redemption rights of the holders of ordinary shares in connection with a proposed business combination, (d) to satisfy the redemption rights of the holders of ordinary shares in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to modify the substance or timing of our obligation to redeem 100% of our ordinary shares if we do not complete our business combination within 12 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this proxy statement), or (e) in connection with the redemption of our public shares upon our failure to complete our business combination, then the warrant exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or other assets paid on each ordinary share in respect of such event.

If the number of issued and outstanding ordinary shares is decreased by a consolidation, combination, reverse share split or reclassification of ordinary shares or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification or similar event, the number of ordinary shares issuable on exercise of each warrant will be decreased in proportion to such decrease in issued and outstanding ordinary shares.

Whenever the number of ordinary shares purchasable upon the exercise of the warrants is adjusted, as described above, the warrant exercise price will be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will be the number of ordinary shares purchasable upon the exercise of the warrants immediately prior to such adjustment, and (y) the denominator of which will be the number of ordinary shares so purchasable immediately thereafter.

In case of any reclassification or reorganization of the issued and outstanding ordinary shares (other than those described above or that solely affects the par value of such ordinary shares), or in the case of any merger or consolidation of us with or into another corporation (other than a consolidation or merger in which we are the continuing corporation and that does not result in any reclassification or reorganization of our issued and outstanding ordinary shares), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of us as an entirety or substantially as an entirety in connection with which we are dissolved, the holders of the warrants will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and in lieu of our ordinary shares immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would have received if such holder had exercised their warrants immediately prior to such event. However, if such holders were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such consolidation or merger, then the kind and amount of securities, cash or other assets for which each warrant will become exercisable will be deemed to be the weighted average of the kind and amount received per share by such holders in such consolidation or merger that affirmatively make such election, and if a tender, exchange or redemption offer has been made to and accepted by such holders (other than a tender, exchange or redemption offer made by the company in connection with redemption rights held by shareholders of the company as provided for in the company’s amended and restated memorandum and articles of association or as a result of the redemption of ordinary shares by the company if a proposed business combination is presented to the shareholders of the company for approval) under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) of which such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act) more than 50% of the issued and outstanding ordinary shares, the holder of a warrant will be entitled to receive the highest amount of cash, securities or other property to which such holder would actually have been entitled as a shareholder if such warrant holder had exercised the warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the ordinary shares held by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustment (from and after the consummation of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in the warrant agreement. Additionally, if less than 70% of the consideration receivable by the holders of ordinary shares in such a transaction is payable in the form of ordinary shares in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the registered holder of the warrant properly exercises the warrant within thirty days following public disclosure of such transaction, the warrant exercise price will be reduced as specified in the warrant agreement based on the per share consideration minus Black-Scholes Warrant Value (as defined in the warrant agreement) of the warrant.

The warrants were issued in registered form under a warrant agreement between Vstock Transfer LLC, as warrant agent, and Venus, which agreement shall remain in effect after the Business Combination. You should review a copy of the warrant agreement, which was filed as an exhibit to the registration statement for Venus’ IPO for a complete description of the terms and conditions applicable to the warrants. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of a majority of the then issued and outstanding warrants (including private warrants) to make any change that adversely affects the interests of the registered holders of warrants.

The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price (or on a cashless basis, if applicable), by certified or official bank check payable to us, for the number of warrants being exercised. The warrant holders do not have the rights or privileges of holders of ordinary shares and any voting rights until they exercise their warrants and receive ordinary shares. After the issuance of ordinary shares upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by shareholders.

Venus was incorporated in the Cayman Islands in order to enjoy the following benefits:

However, certain disadvantages accompany incorporation in the Cayman Islands. These disadvantages include, but are not limited to, the following:

Venus’ memorandum and articles of association do not contain provisions requiring that disputes, including those arising under the securities laws of the United States, between Venus, Venus’ officers, directors and shareholders, be arbitrated.

Substantially all of Venus’ operations are conducted outside the United States, and all of Venus’ assets are located outside the United States. A majority of Venus’ directors and officers are nationals or residents of jurisdictions other than the United States and a substantial portion of their assets are located outside the United States. As a result, it may be difficult for a shareholder to effect service of process within the United States upon these persons, or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States.

New Venus will appoint Puglisi & Associates as its agent upon whom process may be served in any action brought against it under the securities laws of the United States after the consummation of the Business Combination.

Maples and Calder (Hong Kong) LLP, VIYI’s counsel as to Cayman Islands law, and Guangdong Jiayin law firm, VIYI’s counsel as to PRC law, have advised us, respectively, that there is uncertainty as to whether the courts of the Cayman Islands and China (including Hong Kong), respectively, would:

Venus’ Cayman counsel has informed Venus that it is uncertain whether the courts of the Cayman Islands will allow shareholders of Venus to originate actions in the Cayman Islands based upon securities laws of the United States. In addition, there is uncertainty with regard to Cayman Islands law related to whether a judgment obtained from the U.S. courts under civil liability provisions of U.S. securities laws will be determined by the courts of the Cayman Islands as penal or punitive in nature. If such a determination is made, the courts of the Cayman Islands will not recognize or enforce the judgment against a Cayman Islands exempted company, such as Venus. As the courts of the Cayman Islands have yet to rule on making such a determination in relation to judgments obtained from U.S. courts under civil liability provisions of U.S. securities laws, it is uncertain whether such judgments would be enforceable in the Cayman Islands.

Maples and Calder (Hong Kong) LLP has further informed New Venus that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition of such judgments), the courts of the Cayman Islands will, at common law, recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without any re-examination of the merits of the underlying dispute based on the principle that a judgement of a competent foreign court imposes upon the judgment debtor an obligation to pay the liquidated sum for which such judgement has been given, provided such judgment (a) is final and conclusive, (b) is not in respect of taxes, a fine or a penalty, and (c) was not obtained in a manner and is not of a kind the enforcement of which is contrary to natural justice or the public policy of the Cayman Islands. A Cayman Islands court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.

As advised by Guangdong Jiayin law firm, VIYI’s PRC legal counsel, that there is uncertainty as to whether the courts of the PRC would enforce judgments of United States courts or Cayman courts obtained against us or these persons predicated upon the civil liability provisions of the United States federal and state securities laws. Guangdong Jiayin law firm has further advised that the recognition and enforcement of foreign judgments are provided for under PRC Civil Procedures Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of PRC Civil Procedures Law based either on treaties between China and the country where the judgment is made or on reciprocity between jurisdictions. China does not have any treaties or other form of reciprocity with the United States or the Cayman Islands that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the PRC Civil Procedures Law, courts in the PRC will not enforce a foreign judgment against Venus or its directors and officers if they decide that the judgment violates the basic principles of PRC law or national sovereignty, security or public interest. As a result, it is uncertain whether and on what basis a PRC court would enforce a judgment rendered by a court in the United States or in the Cayman Islands.

The validity of the securities offered by this Proxy Statement being issued to the VIYI shareholders and certain other Cayman Islands legal matters will be passed upon for Venus by Ogier.

Becker & Poliakoff LLP, New York, New York, U.S. counsel for Venus, represented Venus in connection with the merger and the preparation of this proxy statement.

DLA Piper UK LLP, Beijing, U.S. counsel for VIYI, represented VIYI in connection with the merger and the preparation of this proxy statement.

Maples and Calder (Hong Kong) LLP, Cayman Islands counsel for VIYI, represented VIYI in connection with the merger and the preparation of this proxy statement with respect to certain Cayman Islands law matters.

Guangdong Jiayin Law Firm, counsel for VIYI, represent VIYI in connection with the merger and preparation of this proxy statement with respect to certain PRC law matters.

The consolidated financial statements of VIYI as of and for each of the years ended December 2020 and 2021 included in this proxy statement have been audited by Friedman LLP, an independent registered public accounting firm as stated in their report appearing herein. Such financial statements are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

The financial statements of Venus Acquisition Corporation as of and for each of the years ended December 31, 2021 and 2020 included in this proxy statement have been audited by Friedman LLP, independent registered public accounting firm, as set forth in their report, thereon appearing elsewhere in this proxy statement, and are included in reliance on such report given upon such firm as experts in auditing and accounting.

Management of Venus knows of no other matters which may be brought before the Extraordinary General Meeting. If any matter other than the proposed Business Combination or related matters should properly come before the Extraordinary General Meeting, however, the persons named in the enclosed proxies will vote proxies in accordance with their judgment on those matters.

Pursuant to the rules of the SEC, Venus and its agents that deliver communications to its shareholders are permitted to deliver to two or more shareholders sharing the same address a single copy of Venus’ proxy statement. Upon written or oral request, Venus will deliver a separate copy of this proxy statement to any shareholder at a shared address who wishes to receive separate copies of such documents in the future. Shareholders receiving multiple copies of such documents may likewise request that Venus deliver single copies of such documents in the future. Shareholders may notify Venus of their requests by calling or writing Venus at:

Advantage Proxy, Inc.
P.O. Box 13581
Des Moines, WA 98198
Toll Free Telephone: (877) 870-8565
Main Telephone: (206) 870-8565
E-mail: ksmith@advantageproxy.com

Venus Acquisition Corporation
477 Madison Avenue, 6^th Floor
New York,
New York 10022
Tel.: (917) 267-4568

Venus is subject to the informational requirements of the Exchange Act, and is required to file reports, any proxy statements and other information with the SEC.

Neither Venus, New Venus, Venus Merger Sub, WiMi nor VIYI has authorized anyone to provide you with information that differs from that contained in this proxy statement. You should not assume that the information contained in this proxy statement is accurate as on any date other than the date of this proxy statement, and neither the mailing of this proxy statement to Venus shareholders nor the consummation of the Business Combination shall create any implication to the contrary.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

See accompanying notes to unaudited condensed consolidated financial statements.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

See accompanying notes to unaudited condensed consolidated financial statements.

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ DEFICIT

(Currency expressed in United States Dollars (“US$”), except for number of shares)

See accompanying notes to unaudited condensed consolidated financial statements.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

See accompanying notes to unaudited condensed consolidated financial statements.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

Venus Acquisition Corporation (“Venus” or the “Company”) is a blank check company incorporated in the Cayman Islands on May 14, 2018. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (“Business Combination”).

On June 10, 2021, the Company, VIYI Algorithm Inc., a Cayman Islands exempted company (“Viyi”), Venus Merger Sub Corp., a Cayman Islands exempted company and wholly-owned subsidiary of the Company (the “Merger Sub”) and WiMi Hologram Cloud Inc., a Cayman Islands company and the legal and beneficial owner of a majority of the issued and outstanding voting securities of Viyi (“Majority Shareholder”), entered into a Merger Agreement (the “Merger Agreement”). Venus Merger Sub Corp. is a company incorporated in the Cayman Islands for the purpose of effecting the Business Combination and to serve as the vehicle for, and be subsumed by, VIYI Algorithm Inc., pursuant to the terms of the Merger Agreement Merger Sub is wholly owned by Venus. See the further description below regarding the proposed business combination with Viyi.

The Company is an early stage and an emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

All activities through June 30, 2022 relate to the Company’s formation, completion of its initial public offering (the “Initial Public Offering”) which occurred on February 11, 2021 and negotiation and consummation of the proposed Business Combination with VIYI. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company generates non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering, which proceeds are held in trust.

The registration statement for the Company’s Initial Public Offering became effective on February 8, 2021. On February 11, 2021, the Company consummated the Initial Public Offering of 4,600,000 units (the “Public Units”), which includes the full exercise by the underwriter of its over-allotment option in the amount of 600,000 Public Units, at $10.00 per Public Unit, generating gross proceeds of $46,000,000 which is described in Note 3.

Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of, 225,000 units (the “Private Units”) at a price of $10.00 per Private Unit in a private placement to Yolanda Management Corporation (the “Sponsor”), generating gross proceeds of $2,250,000, which is described in Note 4.

Transaction costs amounted to $2,462,767, consisting of $805,000 of underwriting fees, $1,150,000 of deferred underwriting fees and $507,767 of other offering costs.

Following the closing of the Initial Public Offering on February 11, 2021, the aggregate amount of $46,460,000 ($10.10 per Public Unit) was placed in a trust account (the “Trust Account”) with Wilmington Trust, National Association acting as trustee. The funds held in the Trust Account can be invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund meeting certain conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the funds in the Trust Account to the Company’s shareholders, as described below, except that interest earned on the Trust Account can be released to the Company to pay its tax obligations. At closing of the Initial Public Offering, the sum of $418,430 was released to the Company to fund its working capital needs.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and sale of the Private Units, although substantially all of the net proceeds are held in trust and are intended to be applied generally toward consummating a Business Combination. NASDAQ rules provide that the Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the Trust Account (as defined below) (less any deferred underwriting commissions and taxes payable on interest earned) at the time of the signing of an agreement to enter into a Business Combination. The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”). There is no assurance that the Company will be able to successfully effect a Business Combination.

The Company will provide its shareholders with the opportunity to redeem all or a portion of their Public Shares upon the completion of a Business Combination either (i) in connection with a shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer. In connection with an Initial Business Combination, the Company may seek shareholder approval of a Business Combination at a meeting called for such purpose at which shareholders may seek to redeem their shares, regardless of whether they vote for or against a Business Combination. The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 upon such consummation of a Business Combination and, if the Company seeks shareholder approval, a majority of the outstanding shares voted are voted in favor of the Business Combination.

Notwithstanding the foregoing, if the Company seeks shareholder approval of a Business Combination and it does not conduct redemptions pursuant to the tender offer rules, the Company’s amended and restated memorandum and articles of association provides that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from seeking redemption rights with respect to 15% or more of the Public Shares without the Company’s prior written consent.

If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its amended and restated memorandum and articles of association, offer such redemption pursuant to the tender offer rules of the Securities and Exchange Commission (“SEC”), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination.

The shareholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially $10.10 per Public Share, subject to increase of up to an additional $0.30 per Public Share in the event that the Sponsor elects to extend the period of time to consummate a Business Combination (see below), plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). The per-share amount to be distributed to shareholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriter (as discussed in Note 6). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s rights or warrants. The ordinary shares will be recorded at redemption value and classified as temporary equity upon the completion of the Initial Public Offering, in accordance with Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity” (“ASC 480”).

The Sponsor and any of the Company’s officers or directors that may hold Founder Shares (as defined in Note 6) (the “shareholders”) and the underwriters will agree (a) to vote their Founder Shares, the ordinary shares included in the Private Units (the “Private Shares”) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination, (b) not to propose an amendment to the Company’s amended and restated

(Currency expressed in United States Dollars (“US$”), except for number of shares)

memorandum and articles of association with respect to the Company’s pre-Business Combination activities prior to the consummation of a Business Combination unless the Company provides dissenting public shareholders with the opportunity to redeem their Public Shares in conjunction with any such amendment; (c) not to redeem any shares (including the Founder Shares) and Private Shares into the right to receive cash from the Trust Account in connection with a shareholder vote to approve a Business Combination (or to sell any shares in a tender offer in connection with a Business Combination if the Company does not seek shareholder approval in connection therewith) or a vote to amend the provisions of the amended and restated Memorandum and Articles of Association relating to shareholders’ rights of pre-Business Combination activity and (d) that the Founder Shares and Private Shares shall not participate in any liquidating distributions upon winding up if a Business Combination is not consummated. However, the shareholders will be entitled to liquidating distributions from the Trust Account with respect to any Public Shares purchased during or after the Initial Public Offering if the Company fails to complete its Business Combination.The Sponsor and any of the Company’s officers or directors that may hold Founder Shares (as defined in Note 6) (the “shareholders”) and the underwriters will agree (a) to vote their Founder Shares, the ordinary shares included in the Private Units (the “Private Shares”) and any Public Shares purchased during or after the Initial Public Offering in favor of a Business Combination, (b) not to propose an amendment to the Company’s amended

On June 10, 2021, the Company entered into the Merger Agreement, which provides for a Business Combination between Venus and VIYI Algorithm Inc. Pursuant to the Merger Agreement, the Business Combination will be effected as a stock transaction and is intended to be qualified as a tax-free reorganization. The Merger Agreement is by and among Venus, Merger Sub, VIYI, and WiMi Hologram Cloud Inc, a Cayman Islands limited liability company as the representative of VIYI’s shareholders. The aggregate consideration for the Acquisition Merger is $400,000,000, payable in the form of 39,600,000 newly issued ordinary shares of Merger Sub (“Merger Sub Ordinary Share”) valued at $10.10 per share.

Upon the closing of the Business Combination, the former Venus shareholders will receive the consideration specified below and the former VIYI shareholders will receive an aggregate of 39,600,000 shares of Merger Sub Ordinary Share.

The Company will be seeking approval from its shareholders of the proposed Business Combination and Merger with VIYI. The Company has filed a Preliminary Proxy Statement on Schedule 14A with the SEC regarding the terms and conditions of the proposed Merger with VIYI and other matters. The Preliminary Proxy Statement is under review by the SEC. Assuming SEC finishes the review of the Proxy Statement, of which there can be no assurance, the Company will provide its shareholders with definitive materials to consider in connection with the solicitation for approval of the Merger with VIYI and other matters as described in the Proxy Statement.

On February 11, 2022, March 11, 2022, April 11, 2022, May 11, 2022, June 11, 2022, July 11, 2022 and August 11, 2022, the Company issued an unsecured promissory note, each in an amount of $153,333 to the Sponsor, pursuant to which such amount had been deposited into the Trust Account in order to extend the amount of available time to complete a business combination until September 11, 2022. However, if the Company anticipates that it may not be able to consummate a Business Combination within 12 months (including the proposed Business combination with VIYI), the Company may extend the period of time to consummate a Business Combination up to nine times, each by an additional month (for a total of 21 months to complete a Business Combination (the “Combination Period”). In order to extend the time available for the Company to consummate a Business Combination, the Sponsor or its affiliate or designees must deposit into the Trust Account $153,333 (approximately $0.033 per Public Share), up to an aggregate of $1,380,000, or $0.30 per Public Share, on or prior to the date of the applicable deadline, for each one month extension. Any funds which may be provided to extend the time frame will be in the form of a loan to us from our sponsor. For the extensions that we have made, the loans are interest free and will not be repaid unless and until we complete a business combination. For the extensions that may be made in the future, the final and definitive terms of the loan in connection with any such loans have not yet been negotiated, but any such loan would be interest free and not repaid unless and until we complete a business combination.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

As of the date of these unaudited condensed consolidated financial statements, the Company has extended the period of time to consummate a business combination six times by an additional one month each time (for a total of up to 6 months from the consummation of the Public Offering to complete a business combination). The insiders have received non-interest bearing, unsecured promissory notes equal to the amount of any such deposits (i.e., $153,333 for each of the six extensions since February 2022). Such notes would either be paid upon consummation of its initial business combination, or, at the lender’s discretion, converted upon consummation of its business combination into additional Private Units at a price of $10.00 per unit.

On each of February 11, 2022, March 11, 2022, April 11, 2022, May 11, 2022, June 11, 2022, July 11, 2022 and August 11, 2022, the Company issued an unsecured promissory note in an amount of $153,333 to the sponsor, pursuant to which such amount had been deposited into the Trust Account in order to extend the amount of available time to complete a business combination until September 11, 2022. Company has two more times to extend the amount of available time to complete a business combination until October 11, 2022. As of June 30, 2022 and December 31, 2021, the note payable balance of $766,665 and $0, respectively.

The Sponsor has agreed that it will be liable to the Company, if and to the extent any claims by a vendor for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amounts in the Trust Account to below (i) $10.10 per share or (ii) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of the trust assets, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). In the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers, prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.

The Company initially had 12 months from the consummation of this offering to consummate the initial business combination. If the Company does not complete a business combination within 12 months from the consummation of the Public Offering, the Company will trigger an automatic winding up, dissolution and liquidation pursuant to the terms of the amended and restated memorandum and articles of association. As a result, this has the same effect as if the Company had formally gone through a voluntary liquidation procedure under the Companies Law. Accordingly, no vote would be required from our shareholders to commence such a voluntary winding up, dissolution and liquidation. However, the Company may extend the period of time to consummate a business combination nine times (for a total of up to 21 months from the consummation of the Public Offering to complete a business combination). As of the date of this report, the Company has extended six times by an additional one month each time (for a total of up to 18 months from the consummation of the Public Offering to complete a business combination), and so it now has until September 11, 2022 to consummate a business combination. Pursuant to the terms of the current amended and restated memorandum and articles of association and the trust agreement between the Company and Wilmington Trust, National Association, in order to extend the time available for the Company to consummate our initial business combination, the Company’s insiders or their affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the Trust Account $0.033 per public share, on or prior to the date of the applicable deadline. The insiders have received non-interest bearing, unsecured promissory notes equal to the amount of any such deposits (i.e., $153,333 for each of the extensions since February 2022) that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the Trust Account to do so. Such notes would either be paid upon consummation of the Company’s initial business combination, or, at the lender’s discretion, converted upon consummation of our business combination

(Currency expressed in United States Dollars (“US$”), except for number of shares)

into additional Private Units at a price of $10.00 per unit. The Company’s shareholders have approved the issuance of the Private Units upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time of the consummation of the Company’s initial business combination. In the event that the Company receives notice from the Company’s insiders five days prior to the applicable deadline of their intent to effect an extension, the Company intends to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, the Company intends to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. If the Company is unable to consummate the Company’s initial business combination by September 11, 2022 (unless further extended), the Company will, as promptly as possible but not more than ten business days thereafter, redeem 100% of the Company’s outstanding public shares for a pro rata portion of the funds held in the Trust Account, including a pro rata portion of any interest earned on the funds held in the Trust Account and not necessary to pay taxes, and then seek to liquidate and dissolve. However, the Company may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of the Company’s public shareholders. In the event of dissolution and liquidation, the public rights will expire and will be worthless.

Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These conditions raise substantial doubt about the Company’s ability to continue as a going concern if a business combination is not consummated by September 11, 2022 (unless further extended). These unaudited condensed consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

The accompanying unaudited condensed consolidated financial statements are presented in U.S. Dollars and conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the SEC. The interim financial information provided is unaudited, but includes all adjustments which management considers necessary for the fair presentation of the results for these periods. Operating results for the six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2022. The information included in this Form 10-Q should be read in conjunction with Management’s Discussion and Analysis, and the unaudited condensed consolidated financial statements and notes thereto included in the Company’s Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on March 25, 2022.

The unaudited condensed consolidated financial statements include the unaudited condensed consolidated financial statements of the Company and its subsidiaries. All significant intercompany transactions and balances between the Company and its subsidiaries are eliminated upon consolidation.

Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors.

The accompanying unaudited condensed consolidated financial statements reflect the activities of the Company and each of the following entities:

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s unaudited condensed consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited condensed consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of June 30, 2022 and December 31, 2021.

At June 30, 2022 and December 31, 2021, the assets held in the Trust Account are held in cash and US Treasury securities. Investment securities in the Company’s Trust Account consisted of $47,306,580 and $46,469,183 in United States Treasury Bills.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The Company classified investments that are directly invested in U.S. Treasuries as available for sales and money market funds are classified in accordance with the trading method. All marketable securities are recorded at their estimated fair value. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive income (loss). The Company evaluates its investments to assess whether those with unrealized loss positions are other than temporarily impaired. Impairments are considered other than temporary if they are related to deterioration in credit risk or if it is likely the Company will sell the securities before the recovery of the cost basis. Realized gains and losses and declines in value determined to be other than temporary are determined based on the specific identification method and are reported in other income (expense), net in the unaudited condensed consolidated statements of operations.

The Company accounts for warrants (Public Warrants or Private Warrants) as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) ASC 480 and ASC 815, “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

The Company accounts for its ordinary shares subject to possible redemption in accordance with the guidance in ASC 480. Ordinary share subject to mandatory redemption (if any) is classified as a liability instrument and is measured at fair value. Conditionally redeemable ordinary shares (including ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) are classified as temporary equity. At all other times, ordinary shares are classified as shareholders’ equity. As of June 30, 2022 and December 31, 2021, the Company’s ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control. 4,600,000 and 4,600,000 ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of the Company’s unaudited condensed consolidated balance sheets.

The Company has made a policy election in accordance with ASC 480-10-S99-3A and recognizes changes in redemption value in accumulated deficit immediately as if the end of the first reporting period after the Initial Public Offering was the redemption date. Redemption value is remeasured to reflect the interest earned on the Trust Account balance that are available for distribution to redeeming shareholders.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The Company complies with the requirements of the ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A – “Expenses of Offering”. Offering costs consist principally of professional and registration fees incurred through the balance sheet date that are related to the Public Offering and that were charged to shareholders’ equity upon the completion of the Public Offering.

FASB ASC Topic 820 “Fair Value Measurements and Disclosures” defines fair value, the methods used to measure fair value and the expanded disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between the buyer and the seller at the measurement date. In determining fair value, the valuation techniques consistent with the market approach, income approach and cost approach shall be used to measure fair value. FASB ASC Topic 820 establishes a fair value hierarchy for inputs, which represent the assumptions used by the buyer and seller in pricing the asset or liability. These inputs are further defined as observable and unobservable inputs. Observable inputs are those that buyer and seller would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs reflect the Company’s assumptions about the inputs that the buyer and seller would use in pricing the asset or liability developed based on the best information available in the circumstances.

The fair value hierarchy is categorized into three levels based on the inputs as follows:

The fair value of the Company’s certain assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the consolidated balance sheet. The fair values of cash and cash equivalents, and other current assets, accrued expenses, due to sponsor are estimated to approximate the carrying values as of June 30, 2022 and December 31, 2021 due to the short maturities of such instruments. See Note 8 for the disclosure of the Company’s assets and liabilities that were measured at fair value on a recurring basis.

Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and trust accounts in a financial institution which, at times may exceed the Federal depository insurance coverage of $250,000. The Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts.

The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” (“ASC 740”) which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases

(Currency expressed in United States Dollars (“US$”), except for number of shares)

of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company’s management determined that the British Virgin Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of June 30, 2022 and December 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

The Company may be subject to potential examination by foreign taxing authorities in the area of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with foreign tax laws.

The Company’s tax provision is zero and it has no deferred tax assets. The Company is considered to be an exempted British Virgin Islands Company and is presently not subject to income taxes or income tax filing requirements in the British Virgin Islands or the United States.

The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share”. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed income (loss) allocable to both the redeemable ordinary shares and non-redeemable ordinary shares and the undistributed income (loss) is calculated using the total net loss less any dividends paid. The Company then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable ordinary shares. Any remeasurement of the accretion to redemption value of the ordinary shares subject to possible redemption was considered to be dividends paid to the public shareholders. As of June 30, 2022 the Company has not considered the effect of the warrants sold in the Initial Public Offering to purchase an aggregate of 2,412,500 shares in the calculation of diluted net loss per share, since the exercise of the warrants is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive and the Company did not have any other dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary share and then share in the earnings of the Company. As a result, diluted loss per share is the same as basic loss per share for the period presented.

The net loss per share presented in the unaudited condensed statement of operations is based on the following:

(Currency expressed in United States Dollars (“US$”), except for number of shares)

Management does not believe that any recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s unaudited condensed consolidated financial statements.

As of June 30, 2022, investment securities in the Company’s Trust Account consisted of $47,306,580 in United States Treasury Bills and $0 in cash. As of December 31, 2021, investment securities in the Company’s Trust Account consisted of $46,469,183 in United States Treasury Bills and $0 in cash. The Company classifies its United States Treasury securities as available-for-sale. Available-for-sale marketable securities are recorded at their estimated fair value on the accompanying June 30, 2022 unaudited condensed consolidated balance sheet. The carrying value, including gross unrealized holding gain as other comprehensive income and fair value of held to marketable securities on June 30, 2022 and December 31, 2021 are as follows:

(Currency expressed in United States Dollars (“US$”), except for number of shares)

On February 11, 2021, the Company sold 4,600,000 Units which includes a full exercise by the underwriters of their over-allotment option in the amount of 600,000 Public Units, at a purchase price of $10.00 per Unit. Each Unit will consist of one ordinary share, one right (“Public Right”) and one redeemable Public Warrant. Each Public Right will convert into one-tenth (1/10) of one ordinary share. Each Public Warrant will entitle the holder to purchase one-half of one ordinary share at an exercise price of $11.50 per whole share (see Note 7).

If the Company does not complete its Business Combination within the necessary time period described in Note 1, the Public Rights will expire and be worthless. Since the Company is not required to net cash settle the Rights and the Rights are convertible upon the consummation of an initial Business Combination, the management determined that the Rights are classified within shareholders’ equity upon their issuance in accordance with ASC 815-40. The proceeds from the sale are allocated to Public Shares and Rights based on the relative fair value of the securities in accordance with ASC 470-20-30. The value of the Public Shares and Rights will be based on the closing price paid by investors.

The Company paid an upfront underwriting discount of $805,000 (1.75%) of the per unit offering price to the underwriter at the closing of the Public Offering, with an additional fee of $1,150,000 (the “Deferred Discount”) of 2.5% of the gross offering proceeds payable upon the Company’s completion of the Business Combination. The Deferred Discount will become payable to the underwriter from the amounts held in the Trust Account solely in the event the Company completes its Business Combination. In the event that the Company does not close the Business Combination, the underwriter has waived its right to receive the Deferred Discount. The underwriter is not entitled to any interest accrued on the Deferred Discount.

Simultaneously with the closing of the Initial Public Offering on February 11, 2021, the Sponsor purchased an aggregate of or 225,000 Private Units at a price of $10.00 per Private Unit, ($2,250,000 in the aggregate), from the Company in a private placement. The proceeds from the sale of the Private Units were added to the net proceeds from the Initial Public Offering held in the Trust Account. The Private Units are identical to the Units sold in the Initial Public Offering, except for the private warrants (“Private Warrants”), as described in Note 8. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Units will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Units and underlying securities will be worthless.

The founders and our officers and directors have agreed not to transfer, assign or sell any of the Founder Shares (except to certain permitted transferees) until, with respect to 50% of the Founder Shares, the earlier of (i) six months after the date of the consummation of a Business Combination, or (ii) the date on which the closing price of the Company’s ordinary shares equals or exceeds $12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after a Business Combination, with respect to the remaining 50% of the Founder Shares, upon six months after the date of the consummation of a Business Combination, or earlier, in each case, if, subsequent to a Business Combination, the Company consummates a subsequent liquidation, merger, share exchange or other similar transaction which results in all of the Company’s shareholders having the right to exchange their ordinary shares for cash, securities or other property.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

In order to finance transaction costs in connection with a Business Combination, the Company’s Sponsor or an affiliate of the Sponsor, or the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes would either be repaid upon consummation of a Business Combination, without interest, or, at the lender’s discretion, up to $1,500,000 of notes may be converted upon consummation of a Business Combination into additional Private Units at a price of $10.00 per Unit. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. As of June 30, 2022 and December 31, 2021, the loan balance was $643,421 and $373,421, respectively.

As discussed in Note 1, the Company may extend the period of time to consummate a Business Combination up to nine times, each by an additional month (for a total of 21 months to complete a Business Combination). In order to extend the time available for the Company to consummate a Business Combination, the Sponsor or its affiliates or designees must deposit into the Trust Account $153,333 (approximately $0.033 per Public Share), up to an aggregate of $1,380,000, or $0.30 per public share, on or prior to the date of the applicable deadline, for each one month extension. Any such payments would be made in the form of a loan. The principal of the promissory note may be drawn down from time to time prior to the earlier of December 31, 2022 or the date of consummates the Business Combination. If the Company completes a Business Combination, the Company would repay such loaned amounts out of the proceeds of the Trust Account released to the Company. If the Company does not complete a Business Combination, the Company will not repay such loans. Furthermore, the letter agreement with the shareholders contains a provision pursuant to which the Sponsor has agreed to waive its right to be repaid for such loans in the event that the Company does not complete a Business Combination. The Sponsor and its affiliates or designees are not obligated to fund the Trust Account to extend the time for the Company to complete a Business Combination.

Ordinary Shares — The Company is authorized to issue 50,000,000 ordinary shares, with a par value of $0.001 per share. Holders of the ordinary shares are entitled to one vote for each ordinary share. At June 30, 2022, there were 1,450,000 ordinary shares issued and outstanding, excluding 4,600,000 ordinary shares subject to possible redemption.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

Rights — Each holder of a right will receive one-tenth (1/10) of one ordinary share upon consummation of a Business Combination, even if the holder of such right redeemed all shares held by it in connection with a Business Combination. No fractional shares will be issued upon exchange of the rights. No additional consideration will be required to be paid by a holder of rights in order to receive its additional shares upon consummation of a Business Combination as the consideration related thereto has been included in the Unit purchase price paid for by investors in the Initial Public Offering. If the Company enters into a definitive agreement for a Business Combination in which the Company will not be the surviving entity, the definitive agreement will provide for the holders of rights to receive the same per share consideration the holders of the ordinary shares will receive in the transaction on an as-converted into ordinary share basis and each holder of a right will be required to affirmatively convert its rights in order to receive 1/10 share underlying each right (without paying additional consideration). The shares issuable upon exchange of the rights will be freely tradable (except to the extent held by affiliates of the Company).

If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of rights will not receive any of such funds with respect to their rights, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such rights, and the rights will expire worthless. Further, there are no contractual penalties for failure to deliver securities to the holders of the rights upon consummation of a Business Combination. Additionally, in no event will the Company be required to net cash settle the rights. Accordingly, the rights may expire worthless.

Each public warrant entitles the holder thereof to purchase one-half (1/2) of one ordinary share at a price of $11.50 per full share, subject to adjustment as described in this proxy statement. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares. This means that only an even number of warrants may be exercised at any given time by a warrant holder.

No public warrants will be exercisable for cash unless the Company has an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such ordinary shares. It is the Company’s current intention to have an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such ordinary shares in effect promptly following consummation of an initial business combination.

Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the public warrants is not effective within 90 days following the consummation of our initial business combination, public warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. In such event, each holder would pay the exercise price by surrendering the warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “Fair Market Value” (defined below) by (y) the Fair Market Value. The “Fair Market Value” shall mean the average reported last sale price of the ordinary shares for the 10 trading days ending on the day prior to the date of exercise. For example, if a holder held 300 warrants to purchase 150 shares and the Fair Market Value on the date prior to exercise was $15.00, that holder would receive 35 shares without the payment of any additional cash consideration. If an exemption from registration is not available, holders will not be able to exercise their warrants on a cashless basis.

The Warrants will become exercisable on the later of (a) the consummation of a Business Combination or (b) 12 months from the effective date of the registration statement relating to the IPO. The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of our completion of an initial business combination, or earlier upon redemption.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The Company may redeem the outstanding warrants (including any outstanding warrants issued upon exercise of the unit purchase option issued to Ladenburg Thalmann & Co., Inc.,), in whole and not in part, at a price of $0.01 per warrant:

If the foregoing conditions are satisfied and the Company would issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior to the scheduled redemption date. However, the price of the ordinary shares may fall below the $18.00 trigger price as well as the $11.50 warrant exercise price per full share after the redemption notice is issued and not limit our ability to complete the redemption.

The redemption criteria for the warrants have been established at a price which is intended to provide warrant holders a reasonable premium to the initial exercise price and provide a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the share price declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the warrants.

If the Company call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.” In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “fair market value” (defined below) by (y) the fair market value. The “fair market value” shall mean the average reported last sale price of the ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether the Company will exercise our option to require all holders to exercise their warrants on a “cashless basis” will depend on a variety of factors including the price of our ordinary shares at the time the warrants are called for redemption, the Company’s cash needs at such time and concerns regarding dilutive share issuances.

The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The following table presents information about the Company’s assets that are measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:

The private warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the unaudited condensed consolidated balance sheets.

The Company established the initial fair value for the private warrants at $380,000 on February 11, 2021, the date of the Company’s Initial Public Offering, using a Black-Scholes model. The Company allocated the proceeds received from the sale of Private Units, first to the private warrants based on their fair values as determined at initial measurement, with the remaining proceeds recorded as ordinary shares subject to possible redemption, and ordinary shares based on their relative fair values recorded at the initial measurement date. The warrants were classified as Level 3 at the initial measurement date due to the use of unobservable inputs.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The key inputs into the binomial model and Black-Scholes model were as follows at their measurement dates:

As of June 30, 2022, the aggregate value of the Private Warrants was $0.42 million. The change in fair value from December 31, 2021 to June 30, 2022 was approximately $10,000.

As of December 31, 2021, the aggregate value of the Private Warrants was $0.41 million. The change in fair value from February 11, 2021 to December 31, 2021 was approximately $30,000.

To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Because of the inherent uncertainty of valuation, those estimated values may be materially higher or lower than the values that would have been used had a ready market for the investments existed. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for investments categorized in Level 3. Level 3 financial liabilities consist of the Private Warrant liability for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate.

Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these unaudited condensed consolidated financial statements. The unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The holders of the Founder Shares, Private Units (and their underlying securities) and any Units that may be issued upon conversion of the Working Capital Loans (and underlying securities) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of the Proposed Offering. The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the consummation of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. The Company will bear the expenses incurred in connection with the filing of any such registration statements.

The Company terminated into short-term agreements for temporary office space. For the six months ended June 30, 2022 and 2021, the Company incurred rent expense of $901 and $6,109, respectively.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

The underwriters are entitled to a deferred fee of 2.5% of the gross proceeds of the Initial Public Offering, or $1,150,000. The deferred fee will be paid in cash upon the closing of a Business Combination from the amounts held in the Trust Account, subject to the terms of the underwriting agreement.

On June 10, 2021, the Company, VIYI, Merger Sub, and WiMi, entered into the Merger Agreement. WiMi holds approximately 73% of the share capital of VIYI.

Pursuant to the Merger Agreement, upon the terms and subject to the conditions of the Merger Agreement and in accordance with the Cayman Islands Companies Act (as revised), the parties intend to effect a business combination transaction whereby the Merger Sub will merge with and into VIYI, with VIYI being the surviving entity and becoming a wholly owned subsidiary of the Company on the terms and subject to the conditions set forth in the Merger Agreement and simultaneously with the closing the Company will change our name to “MicroAlgo Inc.”

The Board of Directors of both the Company and VIYI and the shareholders of VIYI have approved the Merger Agreement and the transactions contemplated by it.

Pursuant to the Merger Agreement, the merger is structured as a stock for stock transaction and is intended to be qualified as a tax-free reorganization. The terms of the merger provide for a valuation of VIYI and its subsidiaries and businesses of $400,000,000. Based upon a per share value of $10.10 per share, the VIYI shareholders will receive approximately 39,600,000 ordinary shares of the Company which will represent approximately 85% of the combined outstanding shares following the closing, assuming no redemptions by our shareholders and assuming conversion of our outstanding rights into 485,000 ordinary shares. Currently, there are 6,050,000 ordinary shares of the Company issued and outstanding (including 4,600,000 ordinary shares subject to possible redemption) (assuming all the units were separated into their component parts on such date).

At the effective time of the Merger Agreement, all outstanding options and other convertible securities of VIYI will be cancelled or converted into ordinary shares of VIYI and exchanged for the Company’s ordinary shares as part of the consideration described above.

In addition, on January 24, 2022, the Company entered into an amendment to the Merger Agreement with VIYI and WiMi. The purposes of the amendment were to:

(Currency expressed in United States Dollars (“US$”), except for number of shares)

to up to $15 million in gross amount. WiMi has agreed that any ordinary shares acquired by it will not be subject to redemption under the Company’s corporate organizational documents and also waived any claims against our Trust Account.

On August 2, 2022, the Company entered into a third amendment to the Merger Agreement with VIYI and WiMi. The purposes of the amendment were to:

1. extend the outside termination date of the proposed merger to November 11, 2022;

2. include as a closing condition the requirement that the requisite vote of the shareholders of VIYI has been obtained;

3. include the requirement of the audited financial statement of VIYI for the year ended 2021 and reviewed financial statement of VIYI for the periods ended June 30, 2022 and March 31, 2022; and

4. make conforming changes to reflect that Purchaser will file a proxy statement with the Securities and Exchange Commission following the execution of the Amendment relating to the approval of the Purchaser’s shareholders of the Merger and the transactions contemplated by the Merger Agreement.

Consummation of the transactions contemplated by the Merger Agreement are subject to customary conditions of the respective parties, including the approval of the Merger Agreement by the Company’s shareholders, and minimum net tangible assets immediately after the closing. Other than as specifically discussed, this report does not assume the closing of the business combination with VIYI.

On August 10, 2022, the Company entered into a fourth amendment to the Merger Agreement with VIYI and WiMi. The purposes of the amendment were to the requirement of VIYI’s for delivering to Company the quarterly reviewed financial statements for the period ended June 30, 2022 from a representation and warranty to a covenant with such financial statements to be delivered not later than September 15, 2022, and to make certain other conforming changes regarding the current status.

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before the unaudited condensed consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after June 30, 2022, up through August 15, 2022 when the Company issued the unaudited condensed consolidated financial statements.

We have audited the accompanying consolidated balance sheets of Venus Acquisition Corporation (the “Company”) as of December 31, 2021 and 2020 and the related consolidated statements of operations, changes in shareholders’ equity (deficit) and cash flows for each of the years in the two-year period ended December 31, 2021 and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company’s business plan is dependent on the completion of a business combination and the Company’s cash and working capital as of December 31, 2021 are not sufficient to complete its planned activities for a reasonable period of time, which is considered to be one year from the issuance date of the financial statements. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

(Currency expressed in United States Dollars (“US$”), except for number of shares)

Venus Acquisition Corporation (“Venus” or the “Company”) is a blank check company incorporated in the Cayman Islands on May 14, 2018. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses (“Business Combination”).

The Company is an early stage and an emerging growth company and, as such, the Company is subject to all of the risks associated with early stage and emerging growth companies.

All activities through December 31, 2021 relates to the Company’s formation, completion of its initial public offering (the “Initial Public Offering”) which occurred on February 11, 2021 and negotiation and consummation of the proposed Business Combination with Viyi. The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company generates non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering, which proceeds are held in trust.

Transaction costs amounted to $2,462,765, consisting of $805,000 of underwriting fees, $1,150,000 of deferred underwriting fees and $507,765 of other offering costs.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

The shareholders will be entitled to redeem their Public Shares for a pro rata portion of the amount then in the Trust Account (initially $10.10 per Public Share, subject to increase of up to an additional $0.30 per Public Share in the event that the Sponsor elects to extend the period of time to consummate a Business Combination (see below), plus any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations). The per-share amount to be distributed to shareholders who redeem their Public Shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriter (as discussed in Note 6). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s rights or warrants. The ordinary shares will be recorded at redemption value and classified as temporary equity upon the completion of the Initial Public Offering, in accordance with Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity” (“ASC 480”).

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

activities prior to the consummation of a Business Combination unless the Company provides dissenting public shareholders with the opportunity to redeem their Public Shares in conjunction with any such amendment; (c) not to redeem any shares (including the Founder Shares) and Private Shares into the right to receive cash from the Trust Account in connection with a shareholder vote to approve a Business Combination (or to sell any shares in a tender offer in connection with a Business Combination if the Company does not seek shareholder approval in connection therewith) or a vote to amend the provisions of the amended and restated Memorandum and Articles of Association relating to shareholders’ rights of pre-Business Combination activity and (d) that the Founder Shares and Private Shares shall not participate in any liquidating distributions upon winding up if a Business Combination is not consummated. However, the shareholders will be entitled to liquidating distributions from the Trust Account with respect to any Public Shares purchased during or after the Initial Public Offering if the Company fails to complete its Business Combination.

On June 10, 2021, the Company entered into the Merger Agreement, which provides for a Business Combination between Venus and VIYI Algorithm Inc. Pursuant to the Merger Agreement, the Business Combination will be effected as a stock transaction and is intended to be qualified as a tax-free reorganization. The Merger Agreement is by and among Venus, Merger Sub, VIYI, and WiMi Hologram Cloud Inc, a Cayman Islands limited liability company as the representative of VIYI’s stockholders. The aggregate consideration for the Acquisition Merger is $400,000,000, payable in the form of 39,600,000 newly issued ordinary shares of Merger Sub (“Merger Sub Ordinary Share”) valued at $10.10 per share.

Upon the closing of the Business Combination, the former Venus shareholders will receive the consideration specified below and the former VIYI stockholders will receive an aggregate of 39,600,000 shares of Merger Sub Ordinary Share.

The Company will be seeking approval from its shareholders of the proposed Business Combination and Merger with VIYI. The Company has filed a Proxy Statement with the SEC regarding the terms and conditions of the proposed Merger with Viyi and other matters. The Proxy Statement is under review by the SEC. Assuming that the Proxy Statement is declared effective by the SEC, of which there can be no assurance, the Company will provide its shareholders with definitive materials to consider in connection with the solicitation for approval of the Merger with Viyi and other matters as described in the Proxy Statement.

The Company issued a Note in an amount of $153,333 to the Sponsor, pursuant to which such amount had been deposited into the Trust Account in order to extend the amount of available time to complete a business combination until March 11, 2022. However, if the Company anticipates that it may not be able to consummate a Business Combination within 12 months (including the proposed Business combination with ViYi), the Company may extend the period of time to consummate a Business Combination up to nine times, each by an additional month (for a total of 21 months to complete a Business Combination (the “Combination Period”). In order to extend the time available for the Company to consummate a Business Combination, the Sponsor or its affiliate or designees must deposit into the Trust Account $153,333 (approximately $0.033 per Public Share), up to an aggregate of $1,380,000, or $0.30 per Public Share, on or prior to the date of the applicable deadline, for each one month extension. Any funds which may be provided to extend the time frame will be in the form of a loan to us from our sponsor. For the extensions that we have made, the loans are interest free and will not be repaid unless and until we complete a business combination. For the extensions that may be made in the future, the final and definitive terms of the loan in connection with any such loans have not yet been negotiated, but any such loan would be interest free and not repaid unless and until we complete a business combination.

On February 11, 2022, the Company and the Sponsor extended the period of time for which the Company is required to consummate a Business Combination from February 11, 2022 to March 11, 2022 and, accordingly, funded a sum of $153,333 into the Company’s Trust Account. On March 11, 2022, the Company elected to further extend the date by which the Company is required to complete a business combination to April 11, 2022 and deposited $153,333 into the Company’s Trust Account.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

If the Company is unable to complete a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter, redeem 100% of the outstanding Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned (net of taxes payable and less interest to pay dissolution expenses up to $50,000), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the remaining shareholders and the Company’s board of directors, proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company, subject in each case to its obligations to provide for claims of creditors and the requirements of applicable law. The underwriter has agreed to waive its rights to the deferred underwriting commission held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period and, in such event, such amounts will be included with the funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00).

Following the closing of the Initial Public Offering on February 11, 2021, a total of $46,460,000 was placed in the Trust Account, and the Company had $418,430 of cash held outside of the Trust Account, after payment of costs related to the Initial Public Offering, and available for working capital purposes. As of December 31, 2021, the Company had a working deficit of $418,172. The Company has incurred and expects to continue to incur significant costs in pursuit of its acquisition plans. In order to finance transaction costs in connection with an intended initial Business Combination, the Sponsor, or an affiliate of the Sponsor or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required up to $1,500,000 as discussed in Note 6. Based on the foregoing, the Company believes it will have sufficient cash to meet its needs to execute its intended initial Business Combination in the next twelve months from the date of the issuance of the accompanying consolidated financial statements.

If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These conditions raise substantial doubt about the Company’s ability to continue as a going concern through one year from the date of these financial statements if a Business Combination is not consummated. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

These accompanying consolidated financial statements have been prepared in U.S. Dollars in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the SEC. In the opinion of management, all adjustments (consisting of normal recurring adjustments) have been made that are necessary to present fairly the consolidated financial position, and the results of its consolidated operations and its consolidated cash flows.

The consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant intercompany transactions and balances between the Company and its subsidiaries are eliminated upon consolidation.

The accompanying consolidated financial statements reflect the activities of the Company and each of the following entities:

Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

At December 31, 2021, the assets held in the Trust Account are held in cash and US Treasury securities. Investment securities in the Company’s Trust Account consisted of $46,469,183 in United States Treasury Bills.

The Company classified investments that are directly invested in U.S. Treasuries as available for sales and money market funds are classified in accordance with the trading method. All marketable securities are recorded at their estimated fair value. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive income (loss). The Company evaluates its investments to assess whether those with unrealized loss positions are other than temporarily impaired. Impairments are considered other than temporary if they are related to deterioration in credit risk or if it is likely the Company will sell the securities before the recovery of the cost basis. Realized gains and losses and declines in value determined to be other than temporary are determined based on the specific identification method and are reported in other income (expense), net in the statements of operations and comprehensive (income) loss.

The Company accounts for warrants (Public Warrants or Private Warrants) as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) ASC 480 and ASC 815, “Derivatives and Hedging” (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

are classified as shareholders’ equity. As of December 31, 2021 and 2020, the Company’s ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control. 4,600,000 and 0 ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’ equity section of the Company’s consolidated balance sheets.

The Company complies with the requirements of the ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A – “Expenses of Offering”. Offering costs consist principally of professional and registration fees incurred through the balance sheet date that are related to the Public Offering and that were charged to shareholders’ equity upon the completion of the Public Offering.

ASC Topic 820 “Fair Value Measurements and Disclosures” (“ASC 820”) defines fair value, the methods used to measure fair value and the expanded disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between the buyer and the seller at the measurement date. In determining fair value, the valuation techniques consistent with the market approach, income approach and cost approach shall be used to measure fair value. ASC 820 establishes a fair value hierarchy for inputs, which represent the assumptions used by the buyer and seller in pricing the asset or liability. These inputs are further defined as observable and unobservable inputs. Observable inputs are those that buyer and seller would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs reflect the Company’s assumptions about the inputs that the buyer and seller would use in pricing the asset or liability developed based on the best information available in the circumstances.

The fair value hierarchy is categorized into three levels based on the inputs as follows:

The fair value of the Company’s certain assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the consolidated balance sheet. The fair values of cash and cash equivalents, and other current assets, accrued expenses, due to sponsor are estimated to approximate the carrying values as of December 31, 2021 due to the short maturities of such instruments. See Note 9 for the disclosure of the Company’s assets and liabilities that were measured at fair value on a recurring basis.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

The Company complies with the accounting and reporting requirements of ASC Topic 740, “Income Taxes,” (“ASC 740”) which requires an asset and liability approach to financial accounting and reporting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that will result in future taxable or deductible amounts, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company’s management determined that the British Virgin Islands is the Company’s major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits, if any, as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2021 and 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

The Company’s tax provision is zero and it has no deferred tax assets. The Company is considered to be an exempted British Virgin Islands Company, and is presently not subject to income taxes or income tax filing requirements in the British Virgin Islands or the United States.

The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share”. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, the Company first considered the undistributed income (loss) allocable to both the redeemable ordinary shares and non-redeemable ordinary shares and the undistributed income (loss) is calculated using the total net loss less any dividends paid. The Company then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable ordinary shares. Any remeasurement of the accretion to redemption value of the ordinary shares subject to possible redemption was considered to be dividends paid to the public stockholders. As of December 31, 2021, the Company has not considered the effect of the warrants sold in the Initial Public Offering to purchase an aggregate of 2,412,500 shares in the calculation of diluted net loss per share, since the exercise of the warrants is contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive and the Company did not have any other dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary share and then share in the earnings of the Company. As a result, diluted loss per share is the same as basic loss per share for the period presented.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

The net loss per share presented in the statement of operations is based on the following:

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

The Company has considered all new accounting pronouncements and has concluded that there are no new pronouncements that may have a material impact on the consolidated results of operations, financial condition, or cash flows, based on the current information.

As of December 31, 2021, investment securities in the Company’s Trust Account consisted of $46,469,183 in United States Treasury Bills. The Company classifies its United States Treasury securities as available-for-sale. Available-for-sale marketable securities are recorded at their estimated fair value on the accompanying December 31, 2021 consolidated balance sheet. The carrying value and fair value of marketable securities on December 31, 2021 are as follows:

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

The founders and our officers and directors have agreed not to transfer, assign or sell any of the Founder Shares (except to certain permitted transferees) until, with respect to 50% of the Founder Shares, the earlier of (i) six months after the date of the consummation of a Business Combination, or (ii) the date on which the closing price of the Company’s ordinary shares equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after a Business Combination, with respect to the remaining 50% of the Founder Shares, upon six months after the date of the consummation of a Business Combination, or earlier, in each case, if, subsequent to a Business Combination, the Company consummates a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of the Company’s shareholders having the right to exchange their ordinary shares for cash, securities or other property.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

As of December 31, 2021 and 2020, the Sponsor had advanced the Company an aggregate of $373,421 and $26,750, respectively. The advances are non-interest bearing and due on demand.

On June 10, 2019, as amended on January 16, 2020, the Company issued an unsecured promissory note to the Sponsor, pursuant to which the Company may borrow up to an aggregate principal amount of $450,000 (the “Promissory Note”). The Promissory Note is non-interest bearing and payable on the earlier of (i) December 31, 2021 or (ii) the consummation of the Initial Public Offering (see Note 3). The outstanding balance under the Promissory Note was repaid at the closing of the Initial Public Offering on February 11, 2021. As of December 31, 2021 and 2020, the principal amount due and owing under the Promissory Note was $0 and $228,483 respectively.

As discussed in Note 1, the Company may extend the period of time to consummate a Business Combination up to nine times, each by an additional month (for a total of 21 months to complete a Business Combination). In order to extend the time available for the Company to consummate a Business Combination, the Sponsor or its affiliates or designees must deposit into the Trust Account $153,333 (approximately $0.033 per Public Share), up to an aggregate of $1,380,000, or $0.30 per public share, on or prior to the date of the applicable deadline, for each one month extension. Any such payments would be made in the form of a loan. The terms of the promissory note to be issued in connection with any such loans have not yet been negotiated. If the Company completes a Business Combination, the Company would repay such loaned amounts out of the proceeds of the Trust Account released to the Company. If the Company does not complete a Business Combination, the Company will not repay such loans. Furthermore, the letter agreement with the shareholders contains a provision pursuant to which the Sponsor has agreed to waive its right to be repaid for such loans in the event that the Company does not complete a Business Combination. The Sponsor and its affiliates or designees are not obligated to fund the Trust Account to extend the time for the Company to complete a Business Combination.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

On February 11, 2022, the Company issued an unsecured promissory note, each in an amount of $153,333 to the Sponsor, pursuant to which such amount had been deposited into the Trust Account in order to extend the amount of available time to complete a business combination until March 11, 2022 (see Note 9). The Notes are non-interest bearing and are payable upon the closing of a business combination. In addition, the Notes may be converted, at the lender’s discretion, into additional Private Units at a price of $10.00 per unit.

Ordinary Shares — The Company is authorized to issue 50,000,000 ordinary shares, with a par value of $0.001 per share. Holders of the ordinary shares are entitled to one vote for each ordinary share. At December 31, 2021, there were 1,450,000 ordinary shares issued and outstanding, excluding 4,600,000 ordinary shares subject to possible redemption (assuming all the units were separated into their component parts on such date).

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

pay the exercise price by surrendering the warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “Fair Market Value” (defined below) by (y) the Fair Market Value. The “Fair Market Value” shall mean the average reported last sale price of the ordinary shares for the 10 trading days ending on the day prior to the date of exercise. For example, if a holder held 300 warrants to purchase 150 shares and the Fair Market Value on the date prior to exercise was $15.00, that holder would receive 35 shares without the payment of any additional cash consideration. If an exemption from registration is not available, holders will not be able to exercise their warrants on a cashless basis.

If the Company calls the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.” In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “Fair Market Value” (defined below) by (y) the Fair Market Value. The “Fair Market Value” shall mean the average reported last sale price of the ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether the Company will exercise our option to require all holders to exercise their warrants on a “cashless basis” will depend on a variety of factors including the price of our ordinary shares at the time the warrants are called for redemption, the Company’s cash needs at such time and concerns regarding dilutive share issuances.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

The fair value of the Company’s consolidated financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:

The following table presents information about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of December 31, 2021, and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value.

The private warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the consolidated balance sheets.

The Company determined the initial fair value for the private warrants at $380,000 on February 11, 2021, the date of the Company’s Initial Public Offering, using a Black-Scholes model. The Company allocated the proceeds received from the sale of Private Units, first to the private warrants based on their fair values as determined at initial measurement, with the remaining proceeds recorded as ordinary shares subject to possible redemption, and ordinary shares based on their relative fair values recorded at the initial measurement date. The warrants were classified as Level 3 at the initial measurement date due to the use of unobservable inputs.

The key inputs into the binomial model and Black-Scholes model were as follows at their measurement dates:

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

As of December 31, 2021, the aggregate value of the Private Warrants was $0.41 million. The change in fair value from February 11, 2021 to December 31, 2021 was approximately $30,000.

Management has evaluated the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s future financial position, results of its operations and/or search for a target company, there has been a significant impact as of the date of these consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the future outcome of this uncertainty.

The holders of our insider shares issued and outstanding on the date of this proxy statement, as well as the holders of the Private Units (and all underlying securities) and any securities our initial shareholders, officers, directors or their affiliates may be issued in payment of working capital loans made to us, will be entitled to registration rights pursuant to an agreement to be signed prior to or on the effective date of this Initial Public Offering. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to our consummation of a business combination. We will bear the expenses incurred in connection with the filing of any such registration statements.

The Company terminated into short-term agreements for temporary office space. For the years ended December 31, 2021 and 2020, the Company incurred rent expense of $6,109 and $23,639, respectively.

On June 10, 2021, the Company, VIYI, Merger Sub, and WiMi, entered into the Merger Agreement. WiMi holds approximately 73% of the share capital of VIYI.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

The Board of Directors of both the Company and VIYI and the stockholders of VIYI have approved the Merger Agreement and the transactions contemplated by it.

Pursuant to the Merger Agreement, the merger is structured as a stock for stock transaction and is intended to be qualified as a tax-free reorganization. The terms of the merger provide for a valuation of VIYI and its subsidiaries and businesses of $400,000,000. Based upon a per share value of $10.10 per share, the VIYI stockholders will receive approximately 39,600,000 ordinary shares of the Company which will represent approximately 85% of the combined outstanding shares following the closing, assuming no redemptions by our stockholders and assuming conversion of our outstanding rights into 485,000 ordinary shares. Currently, there are 6,050,000 ordinary shares of the Company issued and outstanding (including 4,600,000 ordinary shares subject to possible redemption) (assuming all the units were separated into their component parts on such date).

As contemplated by and as a condition of the Merger Agreement, the Company entered into a backstop agreement with Ever Abundant Investments Limited, dated as of June 10, 2021. On January 24, 2022, the Company agreed with Ever Abundant Investments Limited to terminate the backstop agreement and entered into a similar backstop agreement with WiMi.On June 30, 2022, the backstop agreement with WiMi terminated in accordance with its terms and provisions.

In addition, on January 24, 2022, the Company entered into an amendment to the Merger Agreement with VIYI and WiMi. The purposes of the amendment were to:

Pursuant to the amendment to the Merger Agreement, on January 24, 2022, the Company entered into a backstop agreement with WiMi. Under the new agreement, WiMi agreed to purchase (i) ordinary shares in open market transactions in connection with any tendered or proposed redemptions, and (ii) from the Company ordinary shares in a private placement transaction exempt from registration under the Securities Act of 1933, as amended. Any purchases, either from our shareholders seeking to redeem ordinary shares, or from the Company are limited to up to $15 million in gross amount. WiMi has agreed that any ordinary shares acquired by it will not be subject to redemption under the Company’s corporate organizational documents and also waived any claims against our Trust Account.

(CURRENCY EXPRESSED IN UNITED STATES DOLLARS (“US$”), EXCEPT FOR NUMBER OF SHARES)

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before consolidated financial statements are issued, the Company has evaluated all events or transactions that occurred after December 31, 2021, up through the date the Company issued the consolidated financial statements.

On January 24, 2022, Venus, VIYI and WiMi entered into an amendment to the Merger Agreement. The purposes of the amendment were to:

On February 11, 2022, the Company elected to extend the date by which it is required to complete a business combination to March 11, 2022 and deposited $153,333 into its Trust Account. On March 11, 2022, the Company elected to further extend the date by which it is required to complete a business combination to April 11, 2022 and deposited $153,333 into its Trust Account.

VIYI ALGORITHM INC. AND SUBSIDIARIES
UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

VIYI ALGORITHM INC. AND SUBSIDIARIES
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND
COMPREHENSIVE INCOME

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

VIYI ALGORITHM INC. AND SUBSIDIARIES
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN
SHAREHOLDERS’ EQUITY

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

VIYI ALGORITHM INC. AND SUBSIDIARIES
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements.

VIYI Algorithm Inc. (“VIYI”), previously known as VIYI Technology Inc., is a company incorporated on September 24, 2020 under the laws of the Cayman Islands. WiMi Hologram Cloud Inc. (“WiMi Inc.” or the “Parent”) which primarily engaged in augmented reality (“AR”) advertising and entertainment services, is VIYI’s parent company, an 86.5% controlling shareholder as of June 30, 2022. On March 26, 2021, WiMi Inc. entered into an equity transfer agreements with noncontrolling shareholders of the Company, pursuant to which WiMi Inc. transferred total of 20% of the issued share capital of VIYI to Guosheng Holdings Limited for a total consideration of US$10,000,000. On March 26, 2021, WiMi Inc. entered into an equity transfer agreement with Universal Winnings Holding Limited and Joyous Dragon Limited, pursuant to which WiMi Inc. transferred 7% of the issued share capital of VIYI for a consideration of US$3,500,000. WiMi Inc. received full consideration in January 2021 and WiMi Inc.’s holding of VIYI was reduced to 73% as a results of the transactions. VIYI, its consolidated subsidiaries, variable interest entity (“VIE”) and VIE’s subsidiaries (collectively referred to as the “Company”) is primarily engaged in providing central processing algorithm services.

On September 27, 2020, VIYI entered into Acquisition Framework Agreement which was amended and supplemented on September 28, 2020 to acquire 100% equity interests of Fe-da Electronics Company Private Limited. (“Fe-da Electronics”), a provider of Internet of Things solutions based in Singapore, to accelerate the development of the Company’s central processing algorithm services in computer chip and intelligent chip business. The transaction consummated on September 28, 2020 (See note 4 for details). In November 2020, Fe-da Electronics purchased 100% equity interests of Excel Crest Limited (“Excel Crest”) for HKD 1 to support the daily operations of Fe-da Electronics in Hong Kong. On May 6, 2021, Fe-da Electronic established Wisdom Lab Inc, a Cayman Islands company to provide software solutions for computer chips.

On October 9, 2020, VIYI set up a wholly owned holding company in Hong Kong, VIYI Technology Ltd. (“VIYI Ltd”), which holds all of the outstanding equity of Shenzhen Weiyixin Technology Co., Ltd. (“Shenzhen Weiyixin”) established on November 18, 2020 under the laws of the PRC. On November 30, 2020, Shenzhen Weiyixin established Shanghai Weimu Technology Co., Ltd., (“Shanghai Weimu”) in the PRC for software support services, and Shenzhen Weiyixin holds 58% outstanding equity of Shanghai Weimu.

On April 15, 2021, VIYI Ltd formed a 55% owned subsidiary Viwo Technology Limited, a Hong Kong limited company to provide intelligent chips design and solution services.

In connection with a contemplated offering of the Company, the following steps were undertaken:

Shenzhen Yitian Internet Technology Co., Ltd. (“Shenzhen Yitian”) was established on March 8, 2011 and was acquired by the Parent’s VIE, WiMi Cloud Software Co., Ltd. (“Beijing WiMi”) in 2015. Shenzhen Yitian established wholly owned subsidiaries Shenzhen Qianhai Wangxin Technology Co., Ltd. (“Shenzhen Qianhai”) in 2015, Korgas 233 Technology Co., Ltd. (“Korgas 233”) in 2017. On January 14, 2019, Shenzhen Yitian established Shenzhen Yiyou Online Technology Co., Ltd. (“YY online”) On May 15, 2020, Shenzhen Yitian established Wuhan 233 Interactive Entertainment Technology Co., Ltd. (“Wuhan 233”).On October 28, 2020, Shenzhen Yitian established Weidong Technology Co., Ltd. (“Weidong”). Weidong established a wholly owned subsidiary Korgas Weidong Technology Co., Ltd. (“Korgas Weidong”) in October 2020 and a 60% owned subsidiary Tianjin Weidong Technology Co., Ltd. (“Tianjin Weidong”) in December 2020. Shenzhen Yitian and subsidiaries are in the PRC and mainly engaged in provide algorithm services in advertising and gaming industry. Shenzhen Yitian’s main recognized revenue-producing assets are its facility located in Shenzhen, its non-compete agreement with former shareholder and its assembled workforce. Unrecognized revenue-producing assets held by Shenzhen Yitian include certain Internet content provision and other licenses, domain names and trademarks. The Internet content provision and other licenses are required under relevant PRC laws, rules and regulations for the operation of Internet businesses in the PRC, and therefore are integral to the Company’s operations. The Internet content provision licenses require that core PRC trademark registrations and domain names are held by the entity that provide the relevant services.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Shenzhen Yitian and Shenzhen Qianhai had obtained a value-added telecommunications operating license (the “ICP License”) for the provision of internet information services from the appropriate telecommunications authorities. Moreover, Shenzhen Yitian and YY online also possessed the Online Culture Operating License, which were issued by Department of Culture and Tourism of Guangdong, to carry out internet culture activities.

On December 24, 2020, Beijing WiMi transferred 99.0% and 1.0% equity interests in Shenzhen Yitian to Ms. Yao Zhaohua and Ms. Sun Yadong for consideration of RMB 1 and RMB 1, respectively, pursuant to share transfer agreements. Ms. Yao Zhaohua and Ms. Sun Yadong and the original shareholders of Shenzhen Yitian entered into contractual agreement (see contractual agreements below) with Shenzhen Weiyixin on December 24, 2020, which granted Shenzhen Weiyixin effective control of Shenzhen Yitian from December 24, 2020 and enable Shenzhen Weiyixin to receive all the expected residual returns of Shenzhen Yitian and its subsidiaries. The reorganization was completed on December 24, 2020. Shenzhen Weiyixin becomes the primary beneficiary of Shenzhen Yitian and its subsidiaries.

On January 11, 2021, Shenzhen Yitian transferred its 100% equity interest of Weidong and subsidiaries to Shenzhen Weiyixin; its 100% equity interest YY Online to Weidong and its 100% equity interest in Korgas 233 and Wuhan 233 to YY Online. As a result, Wuhan 233 and Korgas 233 became wholly owned subsidiaries of YY Online and YY Online became wholly owned subsidiary of Weidong and Weidong became wholly owned subsidiary of Shenzhen Weiyixin.

All of these entities are under common control of shareholders of VIYI, which results in the consolidation of Shenzhen Yitian and its subsidiaries which have been accounted for as a reorganization of entities under common control at carrying value. The consolidated financial statements are prepared on the basis as if the reorganization became effective as of the beginning of the first period presented in the accompanying unaudited interim condensed consolidated financial statements of the Company.

On July 1, 2021, Weidong acquired 99% interest of Shanghai Guoyu Information Technologies Co., Ltd (“Shanghai Guoyu”). The remaining 1% of Shanghai Guoyu is acquired by YY Online. The aggregate purchase price is RMB 20,000,000. On July 19, 2021 Shanghai Guoyu established 100% owned subsidiary Kashi Guoyu Information Technologies Co., Ltd (“Kashi Guoyu”). On July 14, 2021, Weidong transferred its 100% equity interest of Horgas 233 and Horgas Weidong to Shanghai Guoyu.

On July 19, 2021, Viwo Technology established a fully owned subsidiary Shenzhen Viwotong Technology Co., Ltd. (“Viwotong Tech”) in Shenzhen to support its operations. On November 19, Viwotong Tech acquired 100% equity interests of Guangzhou Tapuyu Internet Technology Co., Ltd. (“Tapuyu”), a provider of advertising services, for RMB 2 (approximately USD 0.3). On December 7, 2021, Viwotong Tech purchased Pengcheng Keyi (Xi’an) Intelligence Technology Co., Ltd. (“Pengcheng Keyi”), a provider of testing equipment development and sales, for RMB 2 (approximately USD 0.3).

Due to the business strategy adjustment, Shenzhen Yitian and its subsidiaries no longer operate the business involving foreign investment restrictions since March 1, 2022, therefore VIYI is able to have direct equity interest in Shenzhen Yitian and its subsidiaries. On April 1, 2022, VIYI terminated the agreements under the VIE structure with Shenzhen Yitian. Shenzhen Yitian’s original shareholders transferred their respective ownership to VIYI WFOE and VIYI WFOE obtained 100% equity control of Shenzhen Yitian and its subsidiaries on April 1, 2022. The reorganization has no effect on the consolidated financial statements as Shenzhen Yitian has been under common control of VIYI Cayman that there is no change of reporting entities.

The accompanying unaudited interim condensed consolidated financial statements include the Company’s direct expenses, as well as an allocation of certain general and administrative and financial expenses paid by the Parent. General and administrative expenses consist primarily share-based compensation expense, salary and related expenses of senior management and VIYI employees, shared management expenses, including accounting, consulting, legal support services, and other expenses to provide operating support to the related businesses.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

These allocations are made using a proportional cost allocation method by considering the proportion of revenues, headcounts as well as estimates of time spent on the provision of services attributable to the Company and the related expenses resulted from the acquisition of subsidiary.

The general and administrative expenses allocated from the Parent amounted to RMB 598,434 and nil for the six months ended June 30, 2021 and 2022, respectively. Income tax provision reflected in the Company’s unaudited interim condensed consolidated statement of income is calculated based on a separate return basis as the Company’s subsidiaries all filed separate tax returns.

Management believes the basis and amounts of these allocations are reasonable. While the expenses allocated to the Company for these items are not necessarily indicative of the expenses that would have been incurred if the Company had been a separate, stand-alone entity, the Company does not believe that there is any significant difference between the nature and amounts of these allocated expenses and the expenses that would have been incurred if the Company had been a separate, stand-alone entity.

The accompanying unaudited interim condensed consolidated financial statements reflect the activities of VIYI and each of the following entities as of June 30, 2022:

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Name	Background		Ownership
Excel Crest Limited (“Excel Crest”)	●	A Hong Kong company	100% owned by Fe-da Electronics
	●	Incorporated on September 10, 2020
	●	Support the daily operations of Fe-da Electronics in Hong Kong

Shanghai Weimu Technology Co., Ltd. (“Shanghai Weimu”)	●	A PRC limited liability company	58% owned by Shenzhen Weiyixin
	●	Incorporated on November 30, 2020
	●	Registered capital of RMB 50,000,000 (USD 7,842,276)
	●	Engages in providing software support services

Wisdom Lab Inc. (“Wisdom Lab”)	●	A Cayman Islands company	100% owned by Fe-Da Electronics
	●	Incorporated on May 6, 2021
	●	Engages in software solution for intelligent chips

Viwo Technology Limited. (“Viwo Tech”)	●	A Hong Kong company	55% owned by VIYI Ltd
	●	Incorporated on April 15, 2021
	●	Engages in intelligent chips design
	●	No operations as of June 30, 2022

Shenzhen Viwotong Technology Co., Ltd. (“Viwotong Tech”)	●	A PRC limited liability company	100% owned by Viwo Tech
	●	Incorporated on July 19, 2021
	●	Registered capital of RMB 10,000,000 (USD 1,568,455)

Shanghai Guoyu Information Technology Co., Ltd. (“Shanghai Guoyu”)	●	A PRC limited liability company	99% owned by Weidong, 1% owned by YY Online
	●	Incorporated on March 18, 2019
	●	Registered capital of RMB 20,000,000 (USD 3,136,910)
	●	Engages in R&D and application of intelligent visual algorithm technology

Kashi Guoyu Information Technology Co., Ltd. (“Kashi Guoyu”)	●	A PRC limited liability company	100% owned by Shanghai Guoyu
	●	Registered capital of RMB 10,000,000 (USD 1,568,455)
	●	Incorporated on July 23, 2021
	●	Engages in R&D and application of intelligent visual algorithm technology

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Name	Background		Ownership
Guangzhou Tapuyu Internet Technology Co., Ltd. (“Tapuyu”)	A PRC limited liability company		100% owned by Viwotong Tech
	●	Registered capital of RMB 1,000,000 (USD 156,846)
	●	Incorporated on June 22, 2021
	●	Engages in central processing algorithm in advertising industry

Pengcheng Keyi (Xi’an) Intelligence Technology Co., Ltd. (“Pengcheng Keyi”)	A PRC limited liability company		100% owned by Viwotong Tech Disposed in July 2022
	●	Registered capital of RMB 5,000,000 (USD 784,228)
	●	Incorporated on July 29, 2021
	●	Engages in testing equipment development and sales

Due to legal restrictions on foreign ownership and investment in, among other areas, value-added telecommunications services, which include the operations of internet content providers, prior to April 1, 2022, the Company operates its internet and other businesses in which foreign investment is restricted or prohibited in the PRC through certain PRC domestic companies. As such, Shenzhen Yitian (from December 24, 2020) is controlled through contractual agreements in lieu of direct equity ownership by the Company or any of its subsidiaries.

Shenzhen Yitian and its subsidiary used to provide Internet information consulting services which required the possession of the Internet Content Provision (“ICP”) licenses and were subject to foreign investment restrictions under relevant PRC laws and regulations. Due to subsequent business strategy adjustment, Shenzhen Yitian and its subsidiary have terminated such Internet information consulting services since March 1, 2022. As a result of the termination of such services, Shenzhen Yitian and its subsidiary were later notified by relevant PRC government authority that the ICP licenses were no longer required and their business was no longer subject to foreign investment restrictions, therefore VIYI can own direct equity interest in Shenzhen Yitian and its subsidiaries. VIYI terminated the agreements under the VIE structure with Shenzhen Yitian, and VIYI’s WFOE achieved 100% equity control of Shenzhen Yitian and its subsidiaries on April 1, 2022. VIYI now controls and receives the economic benefits of Shenzhen Yitian and its subsidiaries’ business operation through equity ownership.

The contractual arrangements consist of a series of four agreements, shareholders power of attorney and irrevocable commitment letters (collectively the “Contractual Arrangements”, which were signed on December 24, 2020). The significant terms of the Contractual Agreements are as follows:

Under the exclusive business cooperation agreement between Shenzhen Weiyixin and Shenzhen Yitian dated December 24, 2020, Shenzhen Weiyixin has the exclusive right to provide to Shenzhen Yitian consulting and services related to, among other things, use of software, operation maintenance, product development, and management and marketing consulting. Shenzhen Weiyixin has the exclusive ownership of intellectual property rights created as a result of the performance of this agreement. Shenzhen Yitian agrees to pay Shenzhen Weiyixin service fee at an amount equal to the consolidated net income after offsetting previous year’s loss (if any). This agreement remained effective until April 1, 2022 when the agreement was terminated by Shenzhen Weiyixin.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to the exclusive share purchase option agreement dated December 24, 2020, by and among Shenzhen Weiyixin, Shenzhen Yitian and each of the shareholders of Shenzhen Yitian, each of the shareholders of Shenzhen Yitian irrevocably granted Shenzhen Weiyixin an exclusive call option to purchase, or have its designated person(s) to purchase, at its discretion, all or part of their equity interests in Shenzhen Yitian, and the purchase price shall be the lowest price permitted by applicable PRC law. Each of the shareholders of Shenzhen Yitian undertakes that, without the prior written consent of Shenzhen Weiyixin or us, they may not increase or decrease the registered capital, amend its articles of association or change registered capital structure. This agreement will remain effective unless terminated in the event that the entire equity interests held by registered shareholders in Shenzhen Yitian have been transferred to Shenzhen Weiyixin or until the date when it is terminated by Shenzhen Weiyixin. Any transfer of shares pursuant to this agreement would be subject to PRC regulations and to any changes required thereunder.

Pursuant to the equity interest pledge agreement dated December 24, 2020, by and among Shenzhen Weiyixin, Shenzhen Yitian and the shareholders of Shenzhen Yitian, the shareholders of Shenzhen Yitian pledged all of their equity interests in Shenzhen Yitian to Shenzhen Weiyixin to guarantee their and Shenzhen Yitian’s obligations under the contractual arrangements including the exclusive consulting and services agreement, the exclusive option agreement, the power of attorney and this equity interest pledge agreement, as well as any loss incurred due to events of default defined therein and all expenses incurred by Shenzhen Weiyixin in enforcing such obligations of Shenzhen Yitian or its shareholders. The shareholders of Shenzhen Yitian agree that, without Shenzhen Weiyixin’s prior written approval, during the term of the equity interest pledge agreement, they will not dispose of the pledged equity interests or create or allow any other encumbrance on the pledged equity interests. The pledge under the equity interest pledge agreement shall take effect upon the completion of registration with the relevant administration for industry and commerce, which was completed as of January 29, 2021, and shall remain valid until the earlier of (1) the completion of all contractual obligations and the repayment of all secured debts, or (2) the time when the pledgee and/or the appointed person(s) have decided, subject to the PRC laws, to purchase the entire equity interests of the pledger in Shenzhen Yitian, and such equity interests of Shenzhen Yitian have been transferred to the pledgee and/or the appointed person(s) in accordance with the law such that the pledgee and/or the appointed person(s) may lawfully engage in the business of Shenzhen Yitian.

Pursuant to the loan agreement dated December 24, 2020, Shenzhen Weiyixin agreed to provide loans to the registered shareholders of Shenzhen Yitian, to be used exclusively as investment in Shenzhen Yitian. The loan must not be used for any other purposes without the relevant lender’s prior written consent. The term of the loan agreement commences from the date of the agreement and ends on the date the lender exercises its exclusive option under the relevant exclusive share purchase option agreement, or when certain defined termination events occur, such as if the lender sends a written notice demanding repayment to the borrower, or upon the default of the borrower, whichever is earlier. After the lender exercises its exclusive option, the borrower may repay the loan by transferring all of its equity interest in the relevant Onshore Holdco to the lender, or a person or entity nominated by the lender, and use the proceeds of such transfer as repayment of the loan. If the proceeds of such transfer is equal to or less than the principal of the loan under the loan agreement, the loan is considered interest-free. If the proceeds of such transfer is higher than the principal of the loan under the loan agreement, any surplus is considered interest for the loan.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to the power of attorney dated December 24, 2020, by Shenzhen Weiyixin and each shareholder of Shenzhen Yitian, respectively, each shareholder of Shenzhen Yitian irrevocably authorized Shenzhen Weiyixin or any person(s) designated by Shenzhen Weiyixin to exercise such shareholder’s voting rights in Shenzhen Yitian, including, without limitation, the power to participate in and vote at shareholder’s meetings, the power to nominate directors and appoint senior management, the power to sell or transfer such shareholder’s equity interest in Shenzhen Yitian, and other shareholders’ voting rights permitted by PRC law and the Articles of Association of Shenzhen Yitian. The power of attorney remains irrevocable and continuously valid from the date of execution so long as each shareholder remains as a shareholder of Shenzhen Yitian.

Pursuant to these letters, the spouses of the applicable shareholders of Shenzhen Yitian unconditionally and irrevocably agreed that the equity interest in Shenzhen Yitian held by them and registered in their names will be disposed of pursuant to the equity interest pledge agreement, the exclusive option agreement, and the power of attorney. Each of their spouses agreed not to assert any rights over the equity interest in Shenzhen Yitian held by their respective spouses. In addition, in the event that any spouse obtains any equity interest in Shenzhen Yitian held by his or her spouse for any reason, he or she agreed to be bound by the contractual arrangements.

Based on the foregoing contractual arrangements, which grant Shenzhen Weiyixin effective control of Shenzhen Yitian and enable Shenzhen Weiyixin to receive all of their expected residual returns, the Company accounts for Shenzhen Yitian as a VIE on December 24, 2020. The consolidated financial statements are prepared on the basis as if the reorganization became effective as of the beginning of the first period presented in the accompanying unaudited interim condensed consolidated financial statements of the Company.

The accompanying unaudited interim condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”), regarding financial reporting, and include all normal and recurring adjustments that management of the Company considers necessary for a fair presentation of its financial position and operation results. The results of operations for the six months ended June 30, 2022 are not necessarily indicative of results to be expected for any other interim period or for the full year of 2022. Accordingly, these unaudited interim condensed financial statements should be read in conjunction with the Company’s audited financial statements and note thereto as of and for the years ended December 31, 2020 and 2021.

The unaudited interim condensed consolidated financial statements include the financial statements of the Company and its subsidiaries, which include the wholly-foreign owned enterprise (“WFOE”) and variable interest entity (“VIE”) and VIE’s subsidiaries over which the Company exercises control and, when applicable, entities for which the Company has a controlling financial interest or is the primary beneficiary. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The preparation of unaudited interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the unaudited interim condensed consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s unaudited interim condensed consolidated financial statements include the useful lives of property and equipment and intangible assets, impairment of long-lived assets and goodwill, allowance for doubtful accounts, provision for contingent liabilities, revenue recognition, deferred taxes and uncertain tax position, the fair value of contingent consideration related to business acquisitions and allocation of expenses from the Parent and Beijing WiMi. Actual results could differ from these estimates.

The Company uses Renminbi (“RMB”) as its reporting currency. The functional currency of VIYI is Hong Kong Dollar, its subsidiary in Singapore is U.S. dollar, and its other subsidiaries which are incorporated in PRC are RMB, respectively, which are their respective local currencies based on the criteria of ASC 830, “Foreign Currency Matters”.

In the unaudited interim condensed consolidated financial statements, the financial information of the Company and other entities located outside of the PRC has been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, expenses, gains and losses are translated using the average rate for the period.

Translation adjustments included in accumulated other comprehensive loss amounted to RMB 2,585,684 and RMB 1,207,811 (USD 179,964) as of December 31, 2021 and June 30, 2022, respectively. The balance sheet amounts, with the exception of shareholders’ equity, at December 31, 2021 and June 30, 2022 were translated at RMB 1.00 to HKD 1.2231 and to HKD 1.1693, respectively. The average translation rates applied to statement of income accounts for the six months ended June 30, 2021 and 2022 were RMB 1.00 to HKD 1.1993 and to HKD 1.2071, respectively. The balance sheet amounts, with the exception of shareholders’ equity at December 31, 2021 and June 30, 2022 were translated at RMB 1.00 to USD 0.1568 and to USD 0.1490, respectively. The average translation rates applied to statement of income accounts for the six months ended June 30, 2021 and 2022 were RMB 1.00 to USD 0.1545 and to USD 0.1542, respectively. The shareholders’ equity accounts were stated at their historical rate. Cash flows are also translated at average translation rates for the periods, therefore, amounts reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the unaudited interim condensed consolidated balance sheets.

Translations of balances in the unaudited interim condensed consolidated balance sheets, unaudited interim condensed consolidated statements of income and unaudited interim condensed consolidated statements of cash flows from RMB into USD as of and for the six months ended June 30, 2022 are solely for the convenience of the reader and were calculated at the rate of RMB 1.00 to USD 0.1490, representing the mid-point reference rate set by Peoples’ Bank of China on June 30, 2022. No representation is made that the RMB amounts represent or could have been, or could be, converted, realized or settled into USD at that rate, or at any other rate.

Short-term investments are investments in wealth management product with underlying in cash, bonds and equity funds. The investments can be redeemed any time and the investment was recorded at fair value. The gain (loss) from sale of any investments and fair value change are recognized in the statements of income and comprehensive income. The Company purchased approximately RMB 109.8 million and redeemed approximately RMB 108.7 million investments during six months ended June 30, 2022. Loss from short term investments for the six months ended June 30, 2021 and 2022 amounted to nil and RMB 1,064,203 (USD 158,566), respectively.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Loans receivable represent loans to a third party under the terms of the agreements signed in November and December 2021 at 3.85% interest per annum. The loans have terms of one-year and are collateralized by real estate property for approximately RMB 24.0 million (USD 3.8 million). Management regularly reviews the aging of loans receivable and changes in payment trends and records allowances when management believes collection of amounts due are at risk. Loans receivable considered uncollectable are written off against allowances after exhaustive efforts at collection are made. As of June 30, 2022, no allowance was deemed necessary. Full amount of loans receivable was subsequently collected in May 2022.

The Company adopted Accounting Standards Update (“ASU”) 2014-09 Revenue from Contracts with Customers (ASC Topic 606) for the fiscal year ended December 31, 2019 using the modified retrospective method for contracts that were not completed as of December 31, 2018. The ASU requires the use of a new five-step model to recognize revenue from customer contracts. The five-step model requires that the Company (i) identifies the contract with the customer, (ii) identifies the performance obligations in the contract, (iii) determines the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocates the transaction price to the respective performance obligations in the contract, and (v) recognizes revenue when (or as) the Company satisfies the performance obligation.

Prior to fiscal year 2019, the Company recognizes revenue when all of the following have occurred: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the price or fees are fixed or determinable, and (iv) the ability to collect is reasonably assured. Revenue is presented in the unaudited interim condensed consolidated statements of income and comprehensive income net of sales taxes. The Company does not offer rights of refund of previously paid or delivered amounts, rebates, rights of return or price protection. In all instances, the Company limits the amount of revenue recognized to the amounts for which it has the right to bill its’ customers.

The application of the five-step model to the revenue streams compared to the prior guidance did not result in significant changes in the way the Company records its revenue. Upon adoption, the Company evaluated its revenue recognition policy for all revenue streams within the scope of the ASU under previous standards and using the five-step model under the new guidance and confirmed that there were no differences in the pattern of revenue recognition.

For the advertising algorithm advertising display services, the Company’s performance obligation is to identify advertising spaces, embed images or videos into films, shows and short form videos that are hosted by leading online streaming platforms in China. Revenue is recognized at a point in time when the related services have been delivered based on the specific terms of the contract, which are commonly based on specific action (i.e. cost per impression (“CPM”) for online display).

The Company enters into advertising contracts with advertisers where the amounts charged per specific action are fixed and determinable, the specific terms of the contracts were agreed on by the Company, the advertisers and channel providers, and collectability is probable. Revenue is recognized on a CPM basis as impressions.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Company has customer services team to directly serve the customers; and (2) having latitude in establish pricing. Therefore the Company acts as the principal of these arrangements and reports revenue earned and costs incurred related to these transactions on a gross basis.

The Company provides central processing algorithm performance-based advertising services for its customers, which enable the customers to get the optimal business opportunities.

The Company’s performance obligation is to help customers to accurately match consumers and traffic users, and thereby increasing the conversion rate of product sale using its proprietary data optimization algorithms. The Company’s revenue is recognized at a point when an ender user completes a transaction at a rate specified in contract. Related service fees are generally billed monthly, based on a per transaction basis.

The Company considers itself as provider of the services as it has control of the specified services and products at any time before it is transferred to the customers which is evidenced by (1) it is primarily responsible to its customers for the services offered where the algorithms and data optimization were designed and performed in house and it has customer services team to directly serve the customers; and (2) having latitude in establish pricing. Therefore VIYI acts as the principal of these arrangements and reports revenue earned and costs incurred related to these transactions on a gross basis.

In addition, through the Company’s data algorithm optimization, it is able to identify certain end user needs and it facilitates certain value added services to the end users. The Company engages third party services provider to perform the services. The Company concludes that it does not control the services as the third party service provider is responsible for providing the service and its responsibility is merely to facilitate the provision of these value added service to the end users and charges a fee. As such the Company recorded revenue from the value added services on a net basis when the services is provided by third party service provider.

The Company generates revenue from jointly operated mobile game publishing services and the licensed out games. In accordance with ASC 606, Revenue Recognition: Principal Agent Considerations, the Company evaluates agreements with the game developers, distribution channels and payment channels in order to determine whether or not the Company acts as the principal or as an agent in the arrangement with each party respectively. The determination of whether to record the revenues gross or net is based on whether the Company’s promise to its customers is to provide the products or services or to facilitate a sale by a third party. The nature of the promise depends on whether the Company controls the products or services prior to transferring it. Control is evidenced by if the Company is primarily responsible for fulling the provision of services and has discretion in establishing the selling price. When the Company controls the products or services, its promise is to provide and deliver the products and revenue is presented gross. When the Company does not control the products, the promise is to facilitate the sale and revenue is presented net.

The Company offers publishing services for mobile games developed by third-party game developers. The Company acted as a distribution channel that it will publish the games on their own app or a third-party owned app or website, named game portals. Through these game portals, game players can download the mobile games to their mobile devices and purchase coins, the virtual currency, for in game premium features to enhance their game playing experience. The Company contracts with third-party payment platforms for collection services offered to game players who have purchased coins. The third-party game developers, third-party payment platforms and the co-publishers are entitled to profit sharing based on a prescribed percentage of the gross amount charged to the game players. The Company’s obligation in the publishing services is completed at a point in time when the game players made a payment to purchase coins.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

With respect to the publishing services arrangements between the Company and the game developer, the Company considered that the Company does not control the services as evidenced by (i) developers are responsible for providing the game product desired by the game players; (ii) the hosting and maintenance of game servers for running the online mobile games is the responsibility of the third-party platforms; (iii) the developers or third-party platforms have the right to change the pricing of in game virtual items. The Company’s responsibilities are publishing, providing payment solution and market promotion service, and thus the Company views the game developers to be its customers and considers itself as the facilitator of the game developers in the arrangements with game players. Accordingly, the Company records the game publishing service revenue from these games, net of amounts paid to the game developers.

The Company also licenses third parties to operate its mobile games developed internally through mobile portal and receives revenue from the third-party licensee operators on a monthly basis. The Company’s performance obligation is to provide mobile games to game operators which enable players of the mobile games to make in game purchases and the Company recognized revenue at a point in time when game players completed the purchases. The Company records revenues on a net basis, as the Company does not have the control of the services provided as it does not have the primary responsibility for fulfillment nor does not have the right to change the pricing of the game services.

Starting in September 2020, the Company has also been engaged in resale of intelligent chips products and accessories. The Company typically enters into written contracts with its customer where the rights of the parties, including payment terms, are identified and sales prices to the customers are fixed with no separate sales rebate, discount, or other incentive and no right of return exists on sales of inventory. The Company’s performance obligation is to deliver products according to contract specifications. The Company recognizes gross product revenue at a point in time when the control of products or services are transferred to customers.

To distinguish a promise to provide products from a promise to facilitate the sale from a third party, the Company considers the guidance of control in ASC 606-10-55-37A and the indicators in 606-10-55-39. The Company considers this guidance in conjunction with the terms in the Company’s arrangements with both suppliers and customers.

In general, the Company controls the products as it has the obligation to (i) fulfill the products delivery and (ii) bear any inventory risk as legal owners. In addition, when establishing the selling prices for delivery of the resale products, the Company has control to set its selling price to ensure it would generate profit for the products delivery arrangements. The Company believes that all these factors indicate that the Company is acting as a principal in this transaction. As a result, revenue from the sales of products is presented on a gross basis.

The Company also designs software for central processing units based on customers’ specific needs. The contract is typically fixed priced and does not provide any post contract customer support or upgrades. The Company’s performance obligation is to design, develop, test and install the related software for customers, all of which are considered one performance obligation as the customers do not obtain benefit for each separate service. The duration of the development period is short, usually less than one year.

The Company’s revenue from software development contracts are generally recognized over time during the development period and the Company has no alternative use of the customized software and application without incurring significant additional costs. Revenue is recognized based on the Company’s measurement of progress towards completion based on output methods when the Company could appropriately measure the customization progress towards completion by reaching certain milestones specified in contracts. Assumptions, risks and uncertainties inherent in the estimates used to measure progress could affect the amount of revenues, receivables and deferred revenues at each reporting period.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company records receivable related to revenue when it has an unconditional right to invoice and receive payment.

Payments received from customers before all of the relevant criteria for revenue recognition met are recorded as deferred revenue.

The Company’s disaggregated revenue streams in consideration of the Company’s type of goods and services and sales channels are as follows:

The Company’s revenue by timing of transfer of goods or services are summarized below:

Cost of revenue for central processing algorithm services comprised of costs paid to channel distributors based on the sales agreements, shared costs with content providers based on the profit sharing arrangements, third party consulting services expenses and compensation expenses for the Company’s professionals.

For intelligent chip and services, the cost of revenue consist primarily of the costs of products sold and third party software development costs.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Cost allocation include allocation of certain general and administrative and financial expenses paid by the Parent. General and administrative expenses consist primarily salary and related expenses of senior management and VIYI employees, shared management expenses, including accounting, consulting, legal support services, and other expenses to provide operating support to the related businesses. These allocations are made using a proportional cost allocation method by considering the proportion of revenues, headcounts as well as estimates of time spent on the provision of services attributable to the Company and the related expenses resulted from the acquisition of subsidiary.

Noncontrolling interest consists of an aggregate of 42% of the equity interest of Shanghai Weimu, 40% of the equity interest of Tianjin Weidong (no operations), and 45% of equity interest of Viwo Tech held by other investors. Excess of contribution received from noncontrolling shareholders over carrying value of the entity is recorded in additional paid in capital. The noncontrolling interests are presented in the unaudited interim condensed consolidated balance sheets, separately from equity attributable to the shareholders of the Company. Noncontrolling interests in the results of the Company are presented on the face of the unaudited interim condensed consolidated statement of operations as an allocation of the total income or loss for the year between non-controlling interest holders and the shareholders of the Company.

The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share”. ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary share outstanding for the period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. During the six months ended June 30, 2021 and 2022, there was no dilutive shares.

Shenzhen Weiyixin entered into Contractual Arrangements with Shenzhen Yitian on December 24, 2020. The significant terms of these Contractual Arrangements are summarized in “Note 1 — Nature of business and organization” above. As a result, prior to April, 1, 2022, the Company classifies Shenzhen Yitian as VIE was consolidated in the unaudited interim condensed consolidated financial statements based on the structure as described in Note 1.

A VIE is an entity that has either a total equity investment that is insufficient to permit the entity to finance its activities without additional subordinated financial support, or whose equity investors lack the characteristics of a controlling financial interest, such as through voting rights, right to receive the expected residual returns of the entity or obligation to absorb the expected losses of the entity. The variable interest holder, if any, that has a controlling financial interest in a VIE is deemed to be the primary beneficiary and must consolidate the VIE.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Shenzhen Weiyixin is deemed to have a controlling financial interest and be the primary beneficiary of Shenzhen Yitian because it has both of the following characteristics:

Pursuant to the Contractual Arrangements, Shenzhen Yitian pays service fees equal to all of its net income to Shenzhen Weiyixin. The Contractual Arrangements are designed so that Shenzhen Yitian operate for the benefit of Shenzhen Weiyixin and ultimately, the Company.

Accordingly, the accounts of Shenzhen Yitian were consolidated in the accompanying financial statements as VIE of Shenzhen Weiyixin from December 24, 2020 forward and retroactively as if the reorganization became effective as of the beginning of the first period presented in the accompanying unaudited interim condensed consolidated financial statements of the Company. Under the VIE Arrangements, the Company has the power to direct activities of Shenzhen Yitian and can have assets transferred out of Shenzhen Yitian. Therefore, the Company considers that there is no asset in Shenzhen Yitian that can be used only to settle obligations of Shenzhen Yitian, except for registered capital and PRC statutory reserves, if any. As Shenzhen Yitian is incorporated as limited liability company under the Company Law of the PRC, creditors of the Shenzhen Yitian do not have recourse to the general credit of the Company for any of the liabilities of Shenzhen Yitian.

In the opinion of management and the Company’s PRC counsel, (i) the ownership structure of the Company is in compliance with existing PRC laws and regulations; (ii) the Contractual Arrangements are valid and binding, and do not result in any violation of PRC laws or regulations currently in effect; and (iii) the business operations of Shenzhen Yitian and the VIE are in compliance with existing PRC laws and regulations in all material respects.

The carrying amount of the unaudited interim condensed consolidated assets and liabilities are as follows:

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws and regulations. Accordingly, the Company cannot be assured that PRC regulatory authorities will not ultimately take a contrary view to the foregoing opinion of its management. If the current corporate structure of the Company or the Contractual Arrangements is found to be in violation of any existing or future PRC laws and regulations, the Company may be required to restructure its corporate structure and operations in the PRC to comply with changing and new PRC laws and regulations. In the opinion of management and the Company’s PRC counsel, the likelihood of loss in respect of the Company’s current corporate structure or the Contractual Arrangements is remote based on current facts and circumstances.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Shanghai Guoyu is committed to the R&D and application of intelligent visual algorithm technology, using image recognition, data analysis and modeling, virtual imaging, visual artificial intelligence algorithm and other technologies, integrating algorithm and data processing capabilities, and integrating functions from data processing to algorithm application, so as to provide customers with a full stack of intelligent visual algorithm services. At present, Shanghai Guoyu mainly serves the Internet marketing industry. The development of Shanghai Guoyu’s business is closely related to the progress and development of the computer vision industry and the Internet marketing industry.

The Company’s acquisition of Shanghai Guoyu was accounted for as business combination in accordance with ASC 805. The Company then allocated the fair value of consideration of Shanghai Guoyu based upon the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date. The Company estimated the fair values of the assets acquired and liabilities assumed at the acquisition date in accordance with the Business Combination standard issued by the FASB with the valuation methodologies using level 3 inputs, except for other current assets and current liabilities were valued using the cost approach. Management of the Company is responsible for determining the fair value of assets acquired, liabilities assumed and intangible assets identified as of the acquisition date and considered a number of factors including valuations from independent appraisers. Acquisition-related costs incurred for the acquisitions are not material and have been expensed as incurred in general and administrative expense.

The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date, which represents the net purchase price allocation on the date of the acquisition of Shanghai Guoyu based on valuation performed by an independent valuation firm engaged by the Company and translated the fair value from USD to RMB using the exchange rate on July 1, 2021 at the rate of USD 1.00 to RMB 6.4709.

Software consists of mainly data algorithm software, with a fair value of approximately RMB 9.0 million (USD 1.4 million) and estimated finite useful life of 6 years.

The amount of revenue and net loss what resulted from the acquisition were approximately RMB 4.0 million (USD 0.6 million) and RMB 1.2 million (USD 0.2 million) during six months ended June 30, 2022.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Pro forma results of operations for the acquisition described above have not been presented because it is not material to the unaudited interim condensed consolidated statements of income and comprehensive income.

On November 17, 2020, Viwotong Tech entered into Acquisition Framework Agreement to acquire 100% equity interests of Guangzhou Tapuyu Internet Technology Co., Ltd. (“Tapuyu”), a provider of advertising services. The aggregate purchase price is RMB 2 (USD 0.3) and the transaction consummated on November 19, 2021. On November 17, 2021, Viwotong Tech entered into Acquisition Framework Agreement to acquire 100% equity interests of Pengcheng Keyi (Xi’an) Intelligence Technology Co., Ltd. (“Pengcheng Keyi”), a provider of testing equipment development and sales. The aggregate purchase price is RMB 2 (USD 0.3) and the purchase consummated on December 7, 2021.

The Company’s acquisitions of Tapuyu and Pengcheng Keyi were accounted for as business combination in accordance with ASC 805. The Company then allocated the fair value of consideration of Tapuyu and Pengcheng Keyi based upon the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date. The Company estimated the fair values of the assets acquired and liabilities assumed at the acquisition date in accordance with the Business Combination standard issued by the FASB with the valuation methodologies using level 3 inputs, except for other current assets and current liabilities were valued using the cost approach. Management of the Company is responsible for determining the fair value of assets acquired, liabilities assumed and intangible assets identified as of the acquisition. Acquisition-related costs incurred for the acquisitions are not material and have been expensed as incurred in general and administrative expense.

The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date, which represents the net purchase price allocation on the date of the acquisition of Tapuyu and translated the fair value from USD to RMB using the exchange rate on November 19, 2021 at the rate of USD 1.00 to RMB 6.3825 and the net purchase price allocation on the date of the acquisition of Pengcheng Keyi and translated the fair value from USD to RMB using the exchange rate on December 7, 2021 at the rate of USD 1.00 to RMB 6.3738.

The amount of revenue and net income that resulted from the acquisitions were approximately RMB 154.7 million (USD 23.0 million) and RMB 0.5 million (USD 0.07 million) during the six months ended June 30, 2022.

As of December 31, 2021 and June 30, 2022, short term investments amounted to nil and nil, respectively. During the six months ended June 30, 2022, the Company invested a total of RMB 109.8 million (USD 16.4 million) in marketable securities and redeemed approximately RMB 108.7 million (USD 16.2 million). The fair value change resulted in loss of approximately RMB 1.1 million (USD 0.2 million) for the six months ended June 30, 2022.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Net recovery for doubtful accounts net for the six months ended June 30, 2021 and 2022 amounted to nil and RMB 1,889,836 (USD 281,586), respectively.

Depreciation expense for the six months ended June 30, 2021 and 2022 amounted to RMB 62,446 and RMB 188,094 (USD 28,026), respectively.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company’s intangible assets with definite useful lives primarily consist of copyrights, non-compete agreements and technology know-hows. The following table summarizes acquired intangible asset balances as of:

Amortization expense for the six months ended June 30, 2021 and 2022 amounted to RMB 4,975,400 and RMB 4,278,024 (USD 637,426), respectively.

During the six months ended June 30, 2021 and 2022, the Company made nil and RMB 600,000 (USD 94,515) in cost method investments, respectively.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The changes in the carrying amount of goodwill allocated to reportable segments As of December 31, 2021 and June 30, 2022 are as follows:

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Due to Parent are those nontrade payables arising from transactions between the Company and the Parent, such as advances made by the Parent on behalf of the Company, and allocated shared expenses paid by the Parent. Those balances are unsecured and non-interest bearing and are payable on demand.

During six months ended June 30, 2021 and 2022 the Company repaid nil and approximately RMB 51,000,000 (USD 7,700,000) to the Parent and borrowed approximately RMB 600,000 and RMB 55,700,000 (USD 8,300,000) from Parent.

Under the current laws of the Cayman Islands, VIYI and Wisdom Lab are not subject to tax on income or capital gain. Additionally, upon payments of dividends to the shareholders, no Cayman Islands withholding tax will be imposed.

VIYI Ltd, Excel Crest and Viwo Tech are incorporated in Hong Kong and are subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate is 16.5% in Hong Kong. The Company did not make any provisions for Hong Kong profit tax as there were no assessable profits derived from or earned in Hong Kong since inception. Under Hong Kong tax law, VIYI Ltd, Excel Crest, Viwo Tech are exempted from income tax on its foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends.

Fe-da Electronics is incorporated in Singapore and is subject to Singapore Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Singapore tax laws. The applicable tax rate is 17% in Singapore, with 75% of the first SGD 10,000 (approximately RMB 49,000) taxable income and 50% of the next SGD 190,000 (approximately RMB 937,000) taxable income are exempted from income tax.

The subsidiaries and VIE incorporated in the PRC are governed by the income tax laws of the PRC and the income tax provision in respect to operations in the PRC is calculated at the applicable tax rates on the taxable income for the periods based on existing legislation, interpretations and practices in respect thereof. Under the Enterprise Income Tax Laws of the PRC (the “EIT Laws”), domestic enterprises and Foreign Investment Enterprises (the “FIE”) are usually subject to a unified 25% enterprise income tax rate while preferential tax rates, tax holidays and even tax exemption may be granted on case-by-case basis. EIT grants preferential tax treatment to certain High and New Technology Enterprises (“HNTEs”). Under this preferential tax treatment, HNTEs are entitled to an income tax rate of 15%, subject to a requirement that they re-apply for HNTE status every three years. In addition, 75% of R&D expenses of the PRC entities are subject to additional deduction from pre-tax income.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Korgas 233, Korgas Weidong and Kashi Guoyu were formed and registered in Korgas and Kashi in Xinjiang Provence, China in 2017, 2020 and 2021. These companies are not subject to income tax for 5 years and can obtain another two years of tax exempt status and three years at reduced income tax rate of 12.5% after the 5 years due to the local tax policies to attract companies in various industries.

Shenzhen Qianhai was formed and registered in Qianhai District in Guangdong Provence, China in 2015. The company is subject to income tax at a reduced rate of 15% due to the local tax policies to attract companies in various industries. The reduced rate benefit will expire in December 2025. The effective tax rates is 0.3% and 3.4% for the six months ended June 30, 2021 and 2022

The Company evaluated the recoverable amounts of deferred tax assets, and provided a valuation allowance to the extent that future taxable profits will be available against which the net operating loss and temporary difference can be utilized. The Company considers both positive and negative factors when assessing the future realization of the deferred tax assets and applied weigh to the relative impact of the evidences to the extent it could be objectively verified.

The Company’s cumulative net operating loss (“NOL”) of approximately RMB 32.8 million (USD 4.9 million) as of June 30, 2022 was mainly from NOL of VIYI Ltd, Shenzhen Yitian, SH Weimu and Wuhan 233. The NOL starts to expire in 2023. Management considers projected future losses outweighs other factors and made a full allowance of related deferred tax assets.

The Company recognized deferred tax liabilities related to the excess of the intangible assets reporting basis over its income tax basis as a result of fair value adjustment from acquisitions in 2015. The deferred tax liabilities will reverse as the intangible assets are amortized for financial statement reporting purposes.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of December 31, 2021 and June 30, 2022, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the six months ended June 30, 2021 and 2022 and also does not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from June 30, 2022.

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. In China, the insurance coverage of each bank is RMB 500,000. As of June 30, 2022, cash balance of RMB 166,693,260 (USD 24,837,331) was deposited with financial institutions located in China, of which RMB 85,135,991 (USD 12,685,280) was subject to credit risk. The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD 500,000 (approximately USD 64,000) if the bank with which an individual/a company hold its eligible deposit fails. As of June 30, 2022, cash balance of HKD 157,833,096, approximately RMB 134,978,864 (USD 20,111,879) was maintained at financial institutions in Hong Kong, of which HKD 155,826,242, approximately RMB 133,262,602 (USD 19,856,156) was subject to credit risk. The Singapore Deposit Insurance Corporation Limited (SDIC) insures deposits in a Deposit Insurance (DI) Scheme member bank or finance company up to SGD 75,000 (approximately USD 57,000) per account. As of June 30, 2022, cash balance of SGD 132,415 approximately RMB 859,797 (USD 128,110) was maintained at DI Scheme banks in Singapore, of which SGD 2,362 approximately RMB 15,339 (USD 2,286) was subject to credit risk. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

A majority of the Company’s expense transactions are denominated in RMB and a significant portion of the Company and its subsidiaries’ assets and liabilities are denominated in RMB. RMB is not freely convertible into foreign currencies. In the PRC, certain foreign exchange transactions are required by law to be transacted only by authorized financial institutions at exchange rates set by the PBOC. Remittances in currencies other than RMB by the Company in China must be processed through the PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to affect the remittance.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

RMB into U.S. dollar for the purpose of making payments for dividends, strategic acquisition or investments or other business purposes, appreciation of U.S. dollar against RMB would have a negative effect on the U.S. dollar amount available to the Company.

For the six months ended June 30, 2021, one customer accounted for 29.0% of the Company’s total revenues. For the six months ended June 30, 2022, one customer accounted for 28.9% of the Company’s total revenues.

As of December 31, 2021, three customers accounted for 17.8%, 16.3% and 12.0% of the Company’s accounts receivable. As of June 30, 2022, one customer accounted for 22.8% of the Company’s accounts receivable.

For the six months ended June 30, 2021, three vendors accounted for 34.3%, 17.5%, and 12.5% of the Company’s total purchases. For the six months ended June 30, 2022, one vendor accounted for 11.8% of the Company’s total purchases.

As of December 31, 2021, six vendors accounted for 26.9%, 22.9%, 12.1%, 11.5%, 11.3% and 11.1% of the Company’s accounts payable. As of June 30, 2022, three vendors accounted for 32.6%, 27.8% and 12.0% of the Company’s accounts payable.

The Company determines if a contract contains a lease at inception. US GAAP requires that the Company’s leases be evaluated and classified as operating or finance leases for financial reporting purposes. The classification evaluation begins at the commencement date and the lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which result in an economic penalty. All of the Company’s real estate leases are classified as operating leases.

The Company has entered into eight non-cancellable operating lease agreements for ten office spaces expiring through December 2023. As of December 31, 2020, upon adoption of FASB ASU 2016-02, the Company recognized approximately RMB 2.7 million right of use (“ROU”) assets and same amount of lease liabilities based on the present value of the future minimum rental payments of leases, using a weighted average discount rate of 7% based on duration of lease terms. One ROU asset and lease liability was recognized during the six months ended June 30, 2022. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases generally do not contain options to extend at the time of expiration and the weighted average remaining lease terms are 1 year.

Operating lease expenses are allocated between the cost of revenue and selling, research and development, general, and administrative expenses. Rent expenses for the six months ended June 30, 2021 and 2022 was RMB 1,720,727 and RMB 1,024,229 (USD 152,610), respectively.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

VIYI was established under the laws of Cayman Islands on September 24, 2020 with authorized share of 1,000,000,000 ordinary shares of par value USD 0.0001 each and 300,000,000 shares outstanding.

The Company’s ability to pay dividends is primarily dependent on the Company receiving distributions of funds from its subsidiary. Relevant PRC statutory laws and regulations permit payments of dividends by SZ Weiyixin, Shanghai Weimu, and Shenzhen Yitian, Shenzhen Qianhai, YY Online, Wuhan 233, Korgas 233, Weidong, Shenzhen Viwotong, Shanghai Guoyu, Korgas Guoyu and Korgas Weidong (collectively “VIYI PRC entities”) only out of its retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations reflected in the accompanying unaudited interim condensed consolidated financial statements prepared in accordance with U.S. GAAP differ from those reflected in the statutory financial statements of VIYI PRC entities.

VIYI PRC entities are required to set aside at least 10% of their after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, VIYI PRC entities may allocate a portion of its after-tax profits based on PRC accounting standards to enterprise expansion fund and staff bonus and welfare fund at its discretion. VIYI PRC entities may allocate a portion of its after-tax profits based on PRC accounting standards to a discretionary surplus fund at its discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by State Administration of Foreign Exchange.

As a result of the foregoing restrictions, VIYI PRC entities are restricted in their ability to transfer their assets to the Company. Foreign exchange and other regulation in the PRC may further restrict VIYI PRC entities from transferring funds to the Company in the form of dividends, loans and advances. As of June 30, 2022, amounts restricted are the paid-in-capital and statutory reserve of VIYI PRC entities, which amounted to RMB 194,410,939 (USD 28,967,270).

As of December 31, 2021 and June 30, 2022, VIYI PRC entities collectively attributed RMB 9,420,703 and RMB 11,190,683 (USD 1,667,414), of retained earnings for their statutory reserves, respectively.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

From time to time, the Company is party to certain legal proceedings, as well as certain asserted and un-asserted claims. Amounts accrued, as well as the total amount of reasonably possible losses with respect to such matters, individually and in the aggregate, are not deemed to be material to the unaudited interim condensed consolidated financial statements.

As a result of the resurgence of COVID-19 variants in first quarter of 2022 in China, the Company’s office in the PRC was again closed for one week in first quarter of 2022. The Company’s customers has been impacted as a result of business disruption due to closures in various cities and affected their customers’ advertising spending. As a result, VIYI experienced lower revenue growth on advertising which affected VIYI’s gross margin.

Potential impact to the Company’s results of operations for 2022 will also depend on economic impact due to the pandemic and if any future resurgence of the virus in Asia, which are beyond the Company’s control. There is no guarantee that the Company’s revenues will grow or remain at a similar level year over year in 2022 and beyond.

ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for detailing the Company’s business segments.

The Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial information of the separate operating segments when making decisions about allocating resources and assessing the performance of the group. The Company has determined that it has two operating segments: (1) central processing algorithm services and (2) intelligent chips and services.

The following tables present summary information by segment for the six months ended June 30, 2021 and 2022:

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company’s operations are primarily based in the mainland PRC and international, where the Company derives a substantial portion of their revenues. Management also review consolidated financial results by business locations. Disaggregated information of revenues by geographic locations are as follows:

The Company evaluated all events and transactions that occurred after June 30, 2022 up through September 2, 2022 the Company issued these unaudited interim condensed consolidated financial statements.

On July 1, 2022, Viwo Technology Inc. entered into an equity transfer agreement to transfer 99.0% and 1.0% of the issued share capital of Pengcheng Keyi to two unrelated individuals at RMB 1.0 and RMB 0.1, respectively.

VIYI ALGORITHM INC. AND SUBSIDIARIES
NOTES TO UNADUITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company performed a test on the restricted net assets of consolidated subsidiary in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08 (3), “General Notes to Financial Statements” and concluded that it was applicable for the Company to disclose the financial statements for the parent company.

The subsidiary did not pay any dividend to the Company for the periods presented. For the purpose of presenting parent only financial information, the Company records its investment in its subsidiary under the equity method of accounting. Such investment is presented on the separate condensed balance sheets of the Company as “Investment in subsidiary” and the income of the subsidiary is presented as “share of income of subsidiary”. Certain information and footnote disclosures generally included in financial statements prepared in accordance with U.S. GAAP have been condensed and omitted.

The Company did not have significant capital and other commitments, long-term obligations, or guarantees As of December 31, 2021 and June 30, 2022.

We have audited the accompanying consolidated balance sheets of VIYI Algorithm Inc. and Subsidiaries (collectively, the “Company”) as of December 31, 2021 and 2020, and the related consolidated statements of income and comprehensive income, changes in shareholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2021, and the related notes (collectively referred to as the financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

The accompanying notes are an integral part of these consolidated financial statements.

VIYI ALGORITHM INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

The accompanying notes are an integral part of these consolidated financial statements.

VIYI ALGORITHM INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

The accompanying notes are an integral part of these consolidated financial statements.

VIYI ALGORITHM INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS — Continued

The accompanying notes are an integral part of these consolidated financial statements.

VIYI Algorithm Inc. (“VIYI”), previously known as VIYI Technology Inc., is a company incorporated on September 24, 2020 under the laws of the Cayman Islands. WiMi Hologram Cloud Inc. (“WiMi Inc.” or the “Parent”) which primarily engaged in augmented reality (“AR”) advertising and entertainment services, is VIYI’s parent company, an 86.5% controlling shareholder as of December 31, 2021. On March 26, 2021, WiMi Inc. entered into an equity transfer agreements with noncontrolling shareholders of the Company, pursuant to which WiMi Inc. transferred total of 20% of the issued share capital of VIYI to Guosheng Holdings Limited for a total consideration of US$10,000,000. On March 26, 2021, WiMi Inc. entered into an equity transfer agreement with Universal Winnings Holding Limited and Joyous Dragon Limited, pursuant to which WiMi Inc. transferred 7% of the issued share capital of VIYI for a consideration of US$3,500,000. WiMi Inc. received full consideration in January 2021 and WiMi Inc.’s holding of VIYI was reduced to 73% as a results of the transactions. VIYI, its consolidated subsidiaries, variable interest entity (“VIE”) and VIE’s subsidiaries (collectively referred to as the “Company”) is primarily engaged in providing central processing algorithm services.

On April 15, 2021, VIYI Ltd formed a 55% owned subsidiary Viwo Technology Limited, a Hong Kong limited company to provide intelligent chips design and solution services.

In connection with a contemplated offering of the Company, the following steps were undertaken:

“ICP License”) for the provision of internet information services from the appropriate telecommunications authorities. Moreover, Shenzhen Yitian and YY online also possessed the Online Culture Operating License, which were issued by Department of Culture and Tourism of Guangdong, to carry out internet culture activities.

The accompanying consolidated financial statements include the Company’s direct expenses, as well as an allocation of certain general and administrative and financial expenses paid by the Parent. General and administrative expenses consist primarily share-based compensation expense, salary and related expenses of senior management and VIYI employees, shared management expenses, including accounting, consulting, legal support services, and other expenses to provide operating support to the related businesses. These allocations are made using a proportional cost allocation method by considering the proportion of revenues, headcounts as well as estimates of time spent on the provision of services attributable to the Company and the related expenses resulted from the acquisition of subsidiary.

The general and administrative expenses allocated from the Parent amounted to RMB 5,577,626 and RMB 598,434 (USD 93,862) for the years ended December 31, 2020 and 2021, respectively. Income tax provision reflected in the Company’s consolidated statement of income is calculated based on a separate return basis as the Company’s subsidiaries all filed separate tax returns.

The accompanying consolidated financial statements reflect the activities of VIYI and each of the following entities as of December 31, 2021:

Due to legal restrictions on foreign ownership and investment in, among other areas, value-added telecommunications services, which include the operations of internet content providers, the Company operates its internet and other businesses in which foreign investment is restricted or prohibited in the PRC through certain PRC domestic companies. As such, Shenzhen Yitian (from December 24, 2020) is controlled through contractual agreements in lieu of direct equity ownership by the Company or any of its subsidiaries.

Due to the business strategy adjustment, Shenzhen Yitian and its subsidiaries no longer operate the business involving foreign investment restrictions since March 1, 2022, therefore VIYI can own direct equity interest in Shenzhen Yitian and its subsidiaries. VIYI terminated the agreements under the VIE structure with Shenzhen Yitian, and VIYI’s WFOE achieved 100% equity control of Shenzhen Yitian and its subsidiaries on April 1, 2022. VIYI now controls and receives the economic benefits of Shenzhen Yitian and its subsidiaries’ business operation through equity ownership.

and services related to, among other things, use of software, operation maintenance, product development, and management and marketing consulting. Shenzhen Weiyixin has the exclusive ownership of intellectual property rights created as a result of the performance of this agreement. Shenzhen Yitian agrees to pay Shenzhen Weiyixin service fee at an amount equal to the consolidated net income after offsetting previous year’s loss (if any). This agreement will remain effective until the date when it is terminated by Shenzhen Weiyixin.

Pursuant to the loan agreement dated December 24, 2020, Shenzhen Weiyixin agreed to provide loans to the registered shareholders of Shenzhen Yitian, to be used exclusively as investment in Shenzhen Yitian. The loan must not be used for any other purposes without the relevant lender’s prior written consent. The term of the loan agreement commences from the date of the agreement and ends on the date the lender exercises its exclusive option under the relevant exclusive share purchase option agreement, or when certain defined termination events occur, such as if the lender sends a written notice demanding repayment to the borrower, or upon the default of the borrower, whichever is earlier. After the lender exercises its exclusive option, the borrower may repay the loan by transferring all of its equity interest in the relevant Onshore Holdco to the lender, or a person or entity nominated by the lender, and use the proceeds of such transfer as repayment of the loan. If the proceeds of such transfer is equal to or less than the principal of the loan under the loan agreement, the loan is considered interest-free. If the proceeds of such transfer is higher than the principal of the loan under the loan agreement, any surplus is considered interest for the loan.

Pursuant to the power of attorney dated December 24, 2020, by Shenzhen Weiyixin and each shareholder of Shenzhen Yitian, respectively, each shareholder of Shenzhen Yitian irrevocably authorized Shenzhen Weiyixin or any person(s) designated by Shenzhen Weiyixin to exercise such shareholder’s voting rights in Shenzhen Yitian, including, without limitation, the power to participate in and vote at shareholder’s meetings, the power to nominate directors and appoint senior management, the power to sell or transfer such shareholder’s equity interest in Shenzhen Yitian, and other shareholders’ voting rights permitted by PRC law and the Articles of Association of Shenzhen Yitian. The power of attorney remains irrevocable and continuously valid from the date of execution so long as each shareholder remains as a shareholder of Shenzhen Yitian.

Pursuant to these letters, the spouses of the applicable shareholders of Shenzhen Yitian unconditionally and irrevocably agreed that the equity interest in Shenzhen Yitian held by them and registered in their names will be disposed of pursuant to the equity interest pledge agreement, the exclusive option agreement, and the power of attorney. Each of their spouses agreed not to assert any rights over the equity interest in Shenzhen Yitian held by their respective spouses. In addition, in the event that any spouse obtains any equity interest in Shenzhen Yitian held by his or her spouse for any reason, he or she agreed to be bound by the contractual arrangements.

The accompanying consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”), regarding financial reporting, and include all normal and recurring adjustments that management of the Company considers necessary for a fair presentation of its financial position and operation results.

The consolidated financial statements include the financial statements of the Company and its subsidiaries, which include the wholly-foreign owned enterprise (“WFOE”) and variable interest entity (“VIE”) and VIE’s subsidiaries over which the Company exercises control and, when applicable, entities for which the Company has a controlling financial interest or is the primary beneficiary. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s consolidated financial statements include the useful lives of property and equipment and intangible assets, impairment of long-lived assets and goodwill, allowance for doubtful accounts, provision for contingent liabilities, revenue recognition, deferred taxes and uncertain tax position, the fair value of contingent consideration related to business acquisitions and allocation of expenses from the Parent and Beijing WiMi. Actual results could differ from these estimates.

In the consolidated financial statements, the financial information of the Company and other entities located outside of the PRC has been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenues, expenses, gains and losses are translated using the average rate for the period.

Translation adjustments included in accumulated other comprehensive loss amounted to RMB 2,130,654 and RMB 2,585,684 (USD 405,553) as of December 31, 2020 and 2021, respectively. The balance sheet amounts, with the exception of shareholders’ equity, at December 31, 2020 and 2021 were translated at RMB 1.00 to HKD 1.1882 and to HKD 1.2231, respectively. The average translation rates applied to statement of income accounts for the years ended December 31, 2020 and 2021 were RMB 1.00 to HKD 1.1245 and to HKD 1.2048, respectively. The balance sheet amounts, with the exception of shareholders’ equity at December 31, 2020 and 2021 were translated at RMB 1.00 to USD 0.1533 and to USD 0.1568, respectively. The average translation rates applied to statement of income accounts for the years ended December 31, 2020 and 2021 were RMB 1.00 to USD 0.1450 and to USD 0.1550, respectively. The shareholders’ equity accounts were stated at their historical rate. Cash flows are also translated at average translation rates for the periods, therefore, amounts reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance sheets.

Translations of balances in the consolidated balance sheets, consolidated statements of income and consolidated statements of cash flows from RMB into USD as of and for the year ended December 31, 2021 are solely for the convenience of the reader and were calculated at the rate of RMB 1.00 to USD 0.1568, representing the mid-point reference rate set by Peoples’ Bank of China on December 31, 2021. No representation is made that the RMB amounts represent or could have been, or could be, converted, realized or settled into USD at that rate, or at any other rate.

Cash and cash equivalents primarily consists of bank deposits with original maturities of three months or less, which are unrestricted as to withdrawal and use. Cash and cash equivalents also consist of funds earned from the Company’s operating revenues which were held at third party platform fund accounts which are unrestricted as to immediate use or withdraw. The Company maintains most of its bank accounts in the PRC, HK and Singapore.

Accounts receivable include trade accounts due from customers. Accounts are considered overdue after 90 days. Management reviews its receivables on a regular basis to determine if the bad debt allowance is adequate, and provides allowance when necessary. The allowance is based on management’s best estimates of specific losses on individual customer exposures, as well as the historical trends of collections. Account balances are charged off against the allowance after all means of collection have been exhausted and the likelihood of collection is not probable. For the year ended December 31, 2020 and 2021, the Company made RMB 663,590 and RMB 1,440,000 (USD 225,858) allowance for doubtful accounts for accounts receivable, respectively.

The gain (loss) from sale of any investments and fair value change are recognized in the statements of income and comprehensive income. The Company purchased approximately RMB 102 million during the year of December 31, 2021 and redeemed all investments by end of year. Income from short term investments for the years ended December 31, 2020 and 2021 amounted to RMB 0 and RMB 1,258,006 (USD 197,313), respectively.

Inventories are comprised of finished goods and are stated at the lower of cost or net realizable value using the weighted average method. Management reviews inventories for obsolescence and cost in excess of net realizable value periodically when appropriate and records a reserve against the inventory when the carrying value exceeds net realizable value. As of December 31, 2020 and 2021, the Company determined that no allowance was necessary.

Prepaid services fees are mainly payments made to vendors or services providers for future services. These amounts are refundable and bear no interest. Prepaid services fees also includes money deposited with certain channel providers to ensure the contents of the advertisement do not violate the terms of the channel providers. The deposits usually have one year term and are refundable upon contract termination. Management reviews its prepaid services fees on a regular basis to determine if the allowance is adequate, and adjusts the allowance when necessary. As of December 31, 2020 and 2021, no allowance was deemed necessary.

Other receivables that are short term in nature include employee advances to pay certain of the Company’s expenses in the normal course of business and certain short-term deposits. Prepaid expenses included utilities or system services. An allowance for doubtful accounts may be established and recorded based on management’s assessment of the likelihood of collection. Management reviews these items on a regular basis to determine if the allowance for doubtful accounts is adequate, and adjusts the allowance when necessary. Delinquent account balances are written-off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable. No allowance was required as of December 31, 2020 and 2021.

Loans receivable represent loans to a third party under the terms of the agreements signed in November and December 2021 at 3.85% interest per annum. The loans have terms of one-year and and are collateralized by real estate property for approximately RMB 24.0 million (USD 3.8 million). Management regularly reviews the aging of loans receivable and changes in payment trends and records allowances when management believes collection of amounts due are at risk. Loans receivable considered uncollectable are written off against allowances after exhaustive efforts at collection are made. As of December 31, 2021, no allowance was deemed necessary. Full amount of loans receivable was subsequently collected in May 2022.

Property and equipment are stated at cost less accumulated depreciation and impairment if applicable. Depreciation is computed using the straight-line method over the estimated useful lives of the assets with 5% residual value. The estimated useful lives are as follows:

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of income and comprehensive income. Expenditures for maintenance and repairs are charged to earnings as incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Company also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives.

Prepaid merger costs consist primarily of expenses paid to attorneys, consultants, underwriters, and etc. related to its merger transaction. The balance will be offset with the proceeds received after the close of the offering.

The Company accounts for investments with less than 20% of the voting shares and does not have the ability to exercise significant influence over operating and financial policies of the investee using the cost method. The Company records cost method investments at the historical cost in its consolidated financial statements and subsequently records any dividends received from the net accumulated earrings of the investee as income. Dividends received in excess of earnings are considered a return of investment and are recorded as reduction in the cost of the investments.

Cost method investments are evaluated for impairment when facts or circumstances indicate that the fair value of the long-term investments is less than its carrying value. An impairment is recognized when a decline in fair value is determined to be other-than-temporary. The Company reviews several factors to determine whether a loss is other-than-temporary. These factors include, but are not limited to, the: (i) nature of the investment; (ii) cause and duration of the impairment; (iii) extent to which fair value is less than cost; (iv) financial condition and near term prospects of the investments; and (v) ability to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. No event had occurred and indicated that other-than-temporary impairment existed and therefore the Company did not record any impairment charges for its investments for the year ended December 31, 2021.

The Company’s intangible assets with definite useful lives primarily consist of copyrights, non-compete agreements, and technology know-hows. Identifiable intangible assets resulting from the acquisitions of subsidiaries accounted for using the purchase method of accounting are estimated by management based on the fair value of assets received. The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment. The Company typically amortizes its intangible assets with definite useful lives on a straight-line basis over the shorter of the contractual terms or the estimated useful lives. The estimated useful lives are as follows:

Goodwill represents the excess of the consideration paid of an acquisition over the fair value of the net identifiable assets of the acquired subsidiaries at the date of acquisition. Goodwill is not amortized and is tested for impairment at least annually, more often when circumstances indicate impairment may have occurred. Goodwill is carried at cost less accumulated impairment losses. If impairment exists, goodwill is immediately written off to its fair value and the loss is recognized in the consolidated statements of operations and comprehensive loss. Impairment losses on goodwill are not reversed.

The Company reviews the carrying value of intangible assets not subject to amortization, including goodwill, to determine whether impairment may exist annually or more frequently if events and circumstances indicate that it is more likely than not that an impairment has occurred. The Company has the option to assess qualitative factors to determine whether it is necessary to perform further impairment testing in accordance with ASC 350-20, as amended by ASU 2017-04. If the Company believes, as a result of the qualitative assessment, that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, then the impairment test described below is required. The Company compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired. If the carrying amount of a reporting unit exceeds its fair value, impairment is recognized for the difference, limited to the amount of goodwill recognized for the reporting unit. Estimating fair value is performed by utilizing various valuation techniques, with the primary technique being a discounted cash flow.

Long-lived assets, including property and equipment and intangible assets with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. For the years ended December 31, 2020 and 2021, no impairment of long-lived assets was recognized.

The purchase price of an acquired company is allocated between tangible and intangible assets acquired and liabilities assumed from the acquired business based on their estimated fair values, with the residual of the purchase price recorded as goodwill. Transaction costs associated with business combinations are expensed as incurred, and are included in general and administrative expenses in the Company’s consolidated statements of operations. The results of operations of the acquired business are included in the Company’s operating results from the date of acquisition.

The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by the Company.

The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels are defined as follow:

Financial instruments included in current assets and current liabilities are reported in the consolidated balance sheets at face value or cost, which approximate fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rates of interest.

Prior to fiscal year 2019, the Company recognizes revenue when all of the following have occurred: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the price or fees are fixed or determinable, and (iv) the ability to collect is reasonably assured. Revenue is presented in the consolidated statements of income and comprehensive income net of sales taxes. The Company does not offer rights of refund of previously paid or delivered amounts, rebates, rights of return or price protection. In all instances, the Company limits the amount of revenue recognized to the amounts for which it has the right to bill its’ customers.

The Company considers itself as provider of the services as it has control of the specified services and products at any time before it is transferred to the customers which is evidenced by (1) the Company is primarily responsible to its customers for products and services offered where the products were designed in house and the Company has customer services team to directly serve the customers; and (2) having latitude in establish pricing. Therefore the Company acts as the principal of these arrangements and reports revenue earned and costs incurred related to these transactions on a gross basis.

The Company provides central processing algorithm performance-based advertising services for its customers, which enable the customers to get the optimal business opportunities.

for running the online mobile games is the responsibility of the third-party platforms; (iii) the developers or third-party platforms have the right to change the pricing of in game virtual items. The Company’s responsibilities are publishing, providing payment solution and market promotion service, and thus the Company views the game developers to be its customers and considers itself as the facilitator of the game developers in the arrangements with game players. Accordingly, the Company records the game publishing service revenue from these games, net of amounts paid to the game developers.

The Company records receivable related to revenue when it has an unconditional right to invoice and receive payment.

Payments received from customers before all of the relevant criteria for revenue recognition met are recorded as deferred revenue.

The Company’s disaggregated revenue streams in consideration of the Company’s type of goods and services and sales channels are as follows:

The Company’s revenue by timing of transfer of goods or services are summarized below:

For intelligent chip and services, the cost of revenue consist primarily of the costs of products sold and third party software development costs.

expenses to provide operating support to the related businesses. These allocations are made using a proportional cost allocation method by considering the proportion of revenues, headcounts as well as estimates of time spent on the provision of services attributable to the Company and the related expenses resulted from the acquisition of subsidiary.

Advertising costs are expensed as incurred and included in selling expenses. Advertising costs are historically immaterial to the Company’s operating expenses. Advertising costs amounted to RMB 75,824 and RMB 1,800 (USD 282) for the years ended December 31, 2020 and 2021, respectively.

Research and development expenses include salaries and other compensation-related expenses to the Company’s research and product development personnel, outsourced subcontractors, as well as office rental, depreciation and related expenses for the Company’s research and product development team.

Revenue represents the invoiced value of service, net of VAT or GST. The VAT and GST are based on gross sales price and VAT rates range up to 13% in China, depending on the type of service provided or product sold, and GST rate is generally 7% in Singapore. Entities that are VAT/GST general taxpayers are allowed to offset qualified input VAT/GST paid to suppliers against their output VAT/GST liabilities. Net VAT/GST balance between input VAT/GST and output VAT/GST is recorded in tax payable. All of the VAT/GST returns filed by the Company’s subsidiaries in China and Singapore, have been and remain subject to examination by the tax authorities for five years from the date of filing.

The Company accounts for current income taxes in accordance with the laws of the relevant tax authorities. The charge for taxation is based on the results for the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred taxes is accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which deductible temporary differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant taxing authorities.

An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. No penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. PRC tax returns filed in 2019 to 2021 are subject to examination by any applicable tax authorities.

Other Income includes government subsidies which are amounts granted by local government authorities as an incentive for companies to promote development of the local technology industry. The Company receives government subsidies related to government sponsored projects, and records such government subsidies as a liability when it is received. The Company records government subsidies as other income when there is no further performance obligation. Total government subsidies amounted to RMB 356,086 and RMB 292,754 (USD 45,917) for the years ended December 31, 2020 and 2021, respectively.

Other income also includes RMB 544,829 and RMB 1,678,351 (USD 263,242) of input VAT credit the Company redeemed during the years ended December 31, 2020 and 2021. As part of VAT reform in 2019, from April 1, 2019 to December 31, 2021, a taxpayer in certain service industries could claim additional 10% of input VAT credit based on total input VAT paid to suppliers, the credit was applied to offset with the Company’s VAT payable.

The Company adopted FASB ASU 2016-02, “Leases” (Topic 842) for the year ended December 31, 2020, and elected the practical expedients that does not require us to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. For lease terms of twelve months or fewer, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities. The Company also adopted the practical expedient that allows lessees to treat the lease and non-lease components of a lease as a single lease component. Upon adoption, the Company recognized approximately RMB 1.6 million right of use (“ROU”) assets and same amount of lease liabilities based on the present value of the future minimum rental payments of leases, using an incremental borrowing rate of 7% based on the duration of lease terms.

Operating lease ROU assets and lease liabilities are recognized at the adoption date or the commencement date, whichever is earlier, based on the present value of lease payments over the lease term. Since the implicit rate for the Company’s leases is not readily determinable, the Company use its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow, on a collateralized basis, an amount equal to the lease payments, in a similar economic environment and over a similar term.

Lease terms used to calculate the present value of lease payments generally do not include any options to extend, renew, or terminate the lease, as the Company does not have reasonable certainty at lease inception that these options will be exercised. The Company generally considers the economic life of its operating lease ROU assets to be comparable to the useful life of similar owned assets. The Company has elected the short-term lease exception, therefore operating lease ROU assets and liabilities do not include leases with a lease term of twelve months or less. Its leases generally do not provide a residual guarantee. The operating lease ROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term.

The Company reviews the impairment of its ROU assets consistent with the approach applied for its other long-lived assets. The Company reviews the recoverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Company has elected to include the carrying amount of operating lease liabilities in any tested asset group and include the associated operating lease payments in the undiscounted future pre-tax cash flows.

The Company records share-based compensation expense for employees by allocations from Wimi Inc. using a proportional cost allocation method by considering the headcount and its estimates of each employee’s time attributable to the Company. The share-based compensation expense are valued at fair value on the grant date when the reward are approved. Share-based compensation is recognized net of forfeitures, as amortized expense on a straight-line basis over the requisite service period, which is the vesting period.

The Company accounts for share-based compensation expenses using an estimated forfeiture rate at the time of grant and revising, if necessary, in subsequent periods if actual forfeitures differ from initial estimates. Share-based compensation expenses are recorded net of estimated forfeitures such that expenses are recorded only for those share-based awards that are expected to vest.

The full-time employees of the Company are entitled to staff welfare benefits including medical care, housing fund, pension benefits, unemployment insurance and other welfare, which are government mandated defined contribution plans. The Company is required to accrue for these benefits based on certain percentages of the employees’ respective salaries, subject to certain ceilings, in accordance with the relevant PRC regulations, and make cash contributions to the state-sponsored plans out of the amounts accrued. Total expenses for the plans were RMB 304,473 and RMB 1,376,192 (USD 215,850) for the years ended December 31, 2020 and 2021, respectively.

Noncontrolling interest consists of an aggregate of 42% of the equity interest of Shanghai Weimu, 40% of the equity interest of Tianjin Weidong (no operations), and 45% of equity interest of Viwo Tech held by other investors. Excess of contribution received from noncontrolling shareholders over carrying value of the entity is recorded in additional paid in capital. The noncontrolling interests are presented in the consolidated balance sheets, separately from equity attributable to the shareholders of the Company. Noncontrolling interests in the results of the Company are presented on the face of the consolidated statement of operations as an allocation of the total income or loss for the year between non-controlling interest holders and the shareholders of the Company.

The Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share”. ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary share outstanding for the period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. During the years ended December 31, 2020 and 2021, there was no dilutive shares.

Pursuant to the laws applicable to the PRC, PRC entities must make appropriations from after-tax profit to the non-distributable “statutory surplus reserve fund”. Subject to certain cumulative limits, the “statutory surplus reserve fund” requires annual appropriations of 10% of after-tax profit until the aggregated appropriations reach 50% of the registered capital (as determined under accounting principles generally accepted in the PRC (“PRC GAAP”) at each year-end). For foreign invested enterprises and joint ventures in the PRC, annual appropriations should be made to the “reserve fund”. For foreign invested enterprises, the annual appropriation for the “reserve fund” cannot be less than 10% of after-tax profits until the aggregated appropriations reach 50% of the registered capital (as determined under PRC GAAP at each year-end). If the Company has accumulated loss from prior periods, the Company is able to use the current period net income after tax to offset against the accumulate loss.

FASB ASC 280, Segment Reporting, establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company’s business segments.

The Company uses the management approach to determine reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker (“CODM”) for making decisions, allocating resources and assessing performance. The Company’s CODM has been identified as the CEO, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company.

Based on management’s assessment, the Company determined that it has two operating segments and therefore two reportable segments as defined by ASC 280, which are central processing algorithm services and intelligent chips and services. All of the Company’s net revenues were generated in the PRC, Hong Kong and Singapore.

Certain prior year amounts have been reclassified to conform to the current year presentation mainly reclassifying prepaid services fess from other receivables and prepaid expenses. The reclassification have no effect on the Company’s reported total assets, revenues or net income.

In May 2019, the FASB issued ASU 2019-05, which is an update to ASU Update No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology. The amendments in Update 2016-13 added Topic 326, Financial Instruments — Credit Losses, and made several consequential amendments to the Codification. Update 2016-13 also modified the accounting for available-for-sale debt securities, which must be individually assessed for credit losses when fair value is less than the amortized cost basis, in accordance with Subtopic 326-30, Financial Instruments — Credit Losses — Available-for-Sale Debt Securities. The amendments in this Update address those stakeholders’ concerns by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. For those entities, the targeted transition relief will increase comparability of financial statement information by providing an option to align measurement methodologies for similar financial assets. Furthermore, the targeted transition relief also may reduce the costs for some entities to comply with the amendments in Update 2016-13 while still providing financial statement users with decision-useful information. In November 2019, the FASB issued ASU No. 2019-10, which to update the

effective date of ASU No. 2016-02 for private companies, not-for-profit organizations and certain smaller reporting companies applying for credit losses, leases, and hedging standard. The new effective date for these preparers is for fiscal years beginning after December 15, 2022. The Company does not expect the adoption of this ASU would have a material effect on the Company’s consolidated financial statements.

In October 2020, the FASB issued ASU 2020-08, “Codification Improvements to Subtopic 310-20, Receivables—Nonrefundable Fees and Other Costs”. The amendments in this Update represent changes to clarify the Codification. The amendments make the Codification easier to understand and easier to apply by eliminating inconsistencies and providing clarifications. ASU 2020-08 is effective for the Company for annual and interim reporting periods beginning July 1, 2021. Early application is not permitted. All entities should apply the amendments in this Update on a prospective basis as of the beginning of the period of adoption for existing or newly purchased callable debt securities. These amendments do not change the effective dates for Update 2017-08. The Company is currently evaluating the impact of this new standard on the Company’s consolidated financial statements and related disclosures.

In October 2020, the FASB issued ASU 2020-10, “Codification Improvements”. The amendments in this Update represent changes to clarify the Codification or correct unintended application of guidance that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. The amendments in this Update affect a wide variety of Topics in the Codification and apply to all reporting entities within the scope of the affected accounting guidance. ASU 2020-10 is effective for annual periods beginning after December 15, 2020 for public business entities. Early application is permitted. The amendments in this Update should be applied retrospectively. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements.

In October 2021, the FASB issued ASU 2021-08, “Business Combinations”. The amendments in this Update address how to determine whether a contract liability is recognized by the acquirer in a business combination and resolve the inconsistency of measuring revenue contracts with customers acquired in a business combination by providing specific guidance on how to recognize and measure acquired contract assets and contract liabilities from revenue contracts in a business combination. The amendments in this Update apply to all entities that enter into a business combination within the scope of Subtopic 805-10, Business Combination-Overalls. For public business entities, ASU 2021-08 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early application is permitted. The amendments in this Update should be applied prospectively to business combinations occurring on or after the effective date of the amendments. The Company does not expect the adoption of this standard to have a material impact on its consolidated financial statements.

Except as mentioned above, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, statements of income and comprehensive income and statements of cash flows.

Shenzhen Weiyixin entered into Contractual Arrangements with Shenzhen Yitian on December 24, 2020. The significant terms of these Contractual Arrangements are summarized in “Note 1 — Nature of business and organization” above. As a result, the Company classifies Shenzhen Yitian as VIE which should be consolidated based on the structure as described in Note 1.

Shenzhen Weiyixin is deemed to have a controlling financial interest and be the primary beneficiary of Shenzhen Yitian because it has both of the following characteristics:

Accordingly, the accounts of Shenzhen Yitian were consolidated in the accompanying financial statements as VIE of Shenzhen Weiyixin from December 24, 2020 forward and retroactively as if the reorganization became effective as of the beginning of the first period presented in the accompanying consolidated financial statements of the Company. Under the VIE Arrangements, the Company has the power to direct activities of Shenzhen Yitian and can have assets transferred out of Shenzhen Yitian. Therefore, the Company considers that there is no asset in Shenzhen Yitian that can be used only to settle obligations of Shenzhen Yitian, except for registered capital and PRC statutory reserves, if any. As Shenzhen Yitian is incorporated as limited liability company under the Company Law of the PRC, creditors of the Shenzhen Yitian do not have recourse to the general credit of the Company for any of the liabilities of Shenzhen Yitian.

If the contracts are deemed not enforceable, the Company may lose effective control of Shenzhen Yitian and will de-consolidate Shenzhen Yitian from the Company’s financial statements. The deconsolidation will result in removal of VIE’s total assets and total liabilities which amounted to RMB 236,759,108 and RMB 131,200,736 respectively as of December 31, 2021. The Company may recognize a loss from deconsolidation for the net assets amount disposed of RMB 105,558,372.

On September 27, 2020, VIYI entered into Acquisition Framework Agreement, which was amended and supplemented on September 28, 2020, to acquire 100% equity interests of Fe-da Electronics Company Pte Ltd. (“Fe-da Electronics”), a provider of Internet of Things solutions based in Singapore, to accelerate the development of the Company’s computer chip and intelligent chip business. The transaction consummated on September 28, 2020. According to the agreement, acquisition consideration is up to USD 35 million (approximately RMB 228.4 million) to acquire the 100% equity interests of Fe-da Electronics. Pursuant to the amended and supplemented agreement, VIYI is to pay USD 15 million (approximately RMB 97.9 million) in cash, and the remaining cash payments for this acquisition are expected to be made in three installments during the next three years, subject to the fulfilment of certain performance conditions by Fe-da Electronics. The first payment of USD 6 million (approximately RMB 39.1 million) is due on March 31, 2022 if the net income of Fe-da Electronics for the year of 2021 is at least USD 3 million (approximately RMB 19.6 million); the second payment of USD 6 million (approximately RMB 39.1 million) is due on March 31, 2023 if the net income of Fe-da Electronics for the year of 2022 is at least USD 6 million (approximately RMB 39.1 million); and the third payment of USD 8 million (approximately RMB 52.2 million) is due on March 31, 2024 if the net income of Fe-da Electronics for the year of 2023 is at least USD 9 million (approximately RMB 58.7 million). On March 24, 2020, the Company and Fe-da Electronics signed a second amended agreement to amend the terms of payment for the three instalments above to be settled altogether on March 31, 2024 instead of over three years. If Fe-da Electronics is unable to meet the performance target in any year, the Company is entitled to a refund of consideration in two times the difference of actual and target net income up to USD 20 million. VIYI paid USD 15 million (approximately RMB 97.9 million) on November 27, 2020.

The main businesses of Fe-da Electronics are the resale of central processing units (“CPU”) for computers and servers. After integrating Fe-da Electronics into VIYI, the Company plans to both retain and strengthen Fe-da Electronics’ current team in its development and customization of central processing algorithm services. The Company also plans to utilize Fe-da Electronics’ existing artificial intelligence (“AI”) and cloud computing technologies to further unlock its potential in the development of cloud service solutions.

The Company’s acquisition of Fe-da Electronics was accounted for as a business combination in accordance with ASC 805. Management estimated the fair value of consideration including any contingent consideration based on the present value of the probability-weighted expected amount of the future payments. The Company then allocated the fair value of consideration of Fe-da Electronics based upon the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date. The Company estimated the fair values of the assets acquired and liabilities assumed at the acquisition date in accordance with the Business Combination standard issued by the FASB with the valuation methodologies using level 3 inputs, except for other current assets and current liabilities were valued using the cost approach. Management of the Company is responsible for determining the fair value of assets acquired, liabilities assumed and intangible assets identified as of the acquisition date and considered a number of factors including valuations from independent appraisers. Acquisition-related costs incurred for the acquisitions are not material and have been expensed as incurred in general and administrative expense.

The following table summarizes the fair value of consideration to acquire Fe-da Electronics on September 28, 2020:

As of December 31, 2020 and 2021, acquisition payable amounted to RMB 1,864,131, net of discount of RMB 1,830,546, and RMB 0, respectively. During the years ended December 31, 2020 and 2021, a total of RMB 914,864 and RMB 1,396,730 (USD 219,071) was recorded for amortization expense of acquisition payable discount, respectively.

The change in fair value measurement of acquisition payable amounted to RMB 3,239,890 (USD 508,162) for the year ended December 31, 2021 and the acquisition payable decreased to RMB 0.

The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date, which represents the net purchase price allocation on the date of the acquisition of Fe-da Electronics based on valuation performed by an independent valuation firm engaged by the Company and translated the fair value from USD to RMB using the exchange rate on September 28, 2020 at the rate of USD 1.00 to RMB 6.8252.

Customer relationship, including the customer list, the awareness of customer views and expectations and continuous interactions with customers, with a fair value of approximately RMB 27.3 million (USD 4.0 million) and estimated finite useful life of 4 years and technology know-hows, including the central processing algorithm technology and the artificial intelligence and cloud computing technologies, with a fair value of approximately RMB 3.1 million (USD 0.4 million) and estimated finite useful life of 5 years were raised from the acquisition.

Approximately RMB 55.5 million (USD 8.1 million) of goodwill arising from the acquisition is mainly attributable to the excess of the consideration paid over the fair value of the net assets acquired that cannot be recognized separately as identifiable assets under U.S. GAAP, and comprise (a) the assembled work force and (b) the expected but unidentifiable business growth as a result of the synergy resulting from the acquisition.

The following unaudited pro forma combined results of operations present the Company’s financial results as if the acquisition of Fe-da Electronics had been completed on January 1, 2020. The unaudited pro forma results do not reflect operating efficiencies or potential cost savings which may result from the consolidation of operations. Accordingly, the unaudited pro forma financial information is not necessarily indicative of the results of operations that the Company would have recognized had it completed the transaction on January 1, 2020. Future results may vary significantly from the results in this pro forma information because of future events and transactions, as well as other factors.

Software consists of mainly data algorithm software, with a fair value of approximately RMB 9.0 million (USD 1.4 million) and estimated finite useful life of 6 years.

The amount of sales and net income what resulted from the acquisition and included in the consolidated statements of income and comprehensive income during the year ended December 31, 2021 were immaterial.

Pro forma results of operations for the acquisition described above have not been presented because it is not material to the consolidated statements of income and comprehensive income.

except for other current assets and current liabilities were valued using the cost approach. Management of the Company is responsible for determining the fair value of assets acquired, liabilities assumed and intangible assets identified as of the acquisition. Acquisition-related costs incurred for the acquisitions are not material and have been expensed as incurred in general and administrative expense.

The following table summarizes the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date, which represents the net purchase price allocation on the date of the acquisition of Tapuyu and translated the fair value from USD to RMB using the exchange rate on November 19, 2021 at the rate of USD 1.00 to RMB 6.3825 and the net purchase price allocation on the date of the acquisition of Pengcheng Keyi and translated the fair value from USD to RMB using the exchange rate on December 7, 2021 at the rate of USD 1.00 to RMB 6.3738.

The amount of sales and net income that resulted from the acquisitions and included in the consolidated statements of income and comprehensive income during the year ended December 31, 2021 were immaterial.

Pro forma results of operations for the acquisition described above have not been presented because it is not material to the consolidated statements of income and comprehensive income.

Provision for doubtful accounts for the years ended December 31, 2020 and 2021 amounted to RMB 663,590 and RMB 1,440,000 (USD 225,858), respectively.

Depreciation expense for the years ended December 31, 2020 and 2021 amounted to RMB 20,053 and RMB 132,618 (USD 20,800), respectively.

Amortization expense for the years ended December 31, 2020 and 2021 amounted to RMB 4,778,674 and RMB 9,466,601 (USD 1,484,794), respectively.

During the years ended December 31, 2020 and 2021, the Company totally made nil and RMB 600,000 (USD 94,107) in cost method investments, respectively.

The changes in the carrying amount of goodwill allocated to reportable segments as of December 31, 2020 and 2021 are as follows:

The Company tests for impairment annually, and between annual tests if the Company becomes aware of an event or a change in circumstances that would indicate the carrying value may be impaired. Accordingly, the Company performed a quantitative assessment of the Company’s fair value of goodwill as of December 31, 2021 using an income approach with assumptions that are considered level 3 inputs with the assistance of a third party valuation firm. The Company concluded that the carrying value of Fe-da Electronics reporting unit exceeded its respective fair value, resulting in a goodwill impairment of approximately RMB 18.5 million (USD 2.9 million) for the year ended December 31, 2021. The fair values of the respective reporting units were determined primarily by discounting estimated future cash flows, which were primarily determined based on revenue and expense growth assumptions and weighted average cost of capital, among other factors. The Company’s goodwill impairment analysis is performed, and related impairment charges recorded, after the impairment analysis and recognition, if any, of impairment charges for long-lived assets other than goodwill and indefinite-lived intangible assets.

The Company’s subsidiary Shanghai Weimu borrowed RMB 500,000 (approximately USD 78,000) from Gou Lei (Non-controlling shareholder and legal representative of Shanghai Weimu) from April 9, 2021 to May 24, 2021. The loan bears interest of 7% per annum and unsecured. The Company repaid the RMB 500,000 loan in May 2021.

Shanghai Weimu also borrowed RMB 700,000 (approximately USD 110,000) from Gou Lei from June 29, 2021 to July 24, 2021. The loan bears interest of 7% per annum and unsecured. The Company repaid the loan in July 2021.

Shanghai Weimu also borrowed RMB 1,200,000 (approximately USD 185,031) from Gou Lei from July 9, 2021 to October 8, 2021. The loan bears interest of 7% per annum and unsecured. The Company repaid the loan in October 2021.

Shanghai Weimu also borrowed RMB 300,000 (approximately USD 46,258) from Gou Lei from September 18, 2021 to December 17, 2021. The loan bears interest of 7% per annum and unsecured. The Company repaid the loan in November 2021.

Shanghai Weimu also borrowed RMB 2,000,000 (approximately USD 313,691) from Gou Lei from October 10, 2021 to October 25, 2021. The loan bears interest of 7% per annum and unsecured. The Company repaid the loan in November and December 2021.

In addition, Shanghai Weimu also borrowed RMB 916,145 (approximately USD 141,200) from Gou Lei during the year ended December 31, 2021. The borrowings bears no interest. The Company repaid the loan in 2021.

Interest expense for the loans amounted to RMB 62,209 (approximately USD 9,757) for the year ended December 31, 2021.

On July 8, 2020, Fe-da Electronics renewed USD 2 million (approximately RMB 13.0 million) banking facility from DBS to replace the old banking facility dated July 4, 2019. The renewed banking facility is available for utilization from July 8, 2020 to July 8, 2021. The facility can be used as inventory/stock financing facility or trade facilities. Fe-Da mainly used the credit facilities for inventory financing. The funds are released from DBS to vendors directly and FE-DA is required to pay DBS in 60 days.

During the year ended December 31, 2021, Fe-da Electronics borrowed additional USD 1,182,468 (RMB 7,628,698) and repaid USD 3,182,468 (RMB 20,531,708) to the credit line. Interest expense pertaining to the above facility for the year ended December 31, 2021 amounted to RMB 50,198 (USD 7,780). The outstanding balance of the facility has been paid off. As the owner of Fe-da Electronics has been changed after the acquisition, the revised banking facility is no longer available for utilization starting from February 2021.

Tax savings for the years ended December 31, 2020 and 2021 amounted to RMB 13,199,964 and RMB 16,802,740 (USD 2,635,435), respectively. The Company’s basic and diluted earnings per shares would have been lower by RMB 0.04 and RMB 0.04 per share for the year ended December 31, 2020 without the preferential tax rate reduction, respectively. The Company’s basic and diluted earnings per shares would have been lower by RMB 0.06 (USD 0.01) and RMB 0.06 (USD 0.01) per share for the year ended December 31, 2021 without the preferential tax rate reduction, respectively.

The following table reconciles China statutory rates to the Company’s effective tax rate:

The Company’s cumulative net operating loss (“NOL”) of approximately RMB 25.5 million (USD 3.9 million) as of December 31, 2021 was mainly from NOL of VIYI Ltd, Shenzhen Yitian, SH Weimu and Wuhan 233. The NOL starts to expire in 2023. Management considers projected future losses outweighs other factors and made a full allowance of related deferred tax assets.

The Company evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of December 31, 2020 and 2021, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the years ended December 31, 2020 and 2021 and also does not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from December 31, 2021.

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. In China, the insurance coverage of each bank is RMB 500,000. As of December 31, 2021, cash balance of RMB 220,837,086 (USD 34,637,308) was deposited with financial institutions located in China, of which RMB 214,025,713 (USD 33,568,975) was subject to credit risk. The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD 500,000 (approximately USD 64,000) if the bank with which an individual/a company hold its eligible deposit fails. As of December 31, 2021, cash balance of HKD 58,080,633, approximately RMB 47,486,726 (USD 7,448,080) was maintained at financial institutions in Hong Kong, of which HKD 56,503,255, approximately RMB 46,197,061 (USD 7,245,802) was subject to credit risk. The Singapore Deposit Insurance Corporation Limited (SDIC) insures deposits in a Deposit Insurance (DI) Scheme member bank or finance company up to SGD 75,000 (approximately USD 57,000) per account. As of December 31, 2021, cash balance of SGD 924,112 approximately RMB 4,024,785 (USD 631,270) was maintained at DI Scheme banks in Singapore, of which SGD 695,425 approximately RMB 3,028,784 (USD 475,051) was subject to credit risk. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

To the extent that the Company needs to convert U.S. dollars into RMB for capital expenditures and working capital and other business purposes, appreciation of RMB against U.S. dollar would have an adverse effect on the RMB amount the Company would receive from the conversion. Conversely, if the Company decides to convert RMB into U.S. dollar for the purpose of making payments for dividends, strategic acquisition or investments or other business purposes, appreciation of U.S. dollar against RMB would have a negative effect on the U.S. dollar amount available to the Company.

For the year ended December 31, 2020, two customers accounted for 13.1% and 12.1% of the Company’s total revenues. For the year ended December 31, 2021, one customer accounted for 23.9% of the Company’s total revenues.

As of December 31, 2020, three customers accounted for 32.5%, 15.7% and 10.4% of the Company’s accounts receivable. As of December 31, 2021, three customers accounted for 17.8%, 16.3% and 12.0% of the Company’s accounts receivable.

For the year ended December 31, 2020, four vendors accounted for 31.4%, 17.3%, 12.6% and 12.2% of the Company’s total purchases. For the year ended December 31, 2021, one vendor accounted for 25.0% of the Company’s total purchases.

As of December 31, 2020, three vendors accounted for 47.7%, 28.1% and 17.8% of the Company’s accounts payable. As of December 31, 2021, six vendors accounted for 26.9%, 22.9%, 12.1%, 11.5%, 11.3% and 11.1% of the Company’s accounts payable.

The Company has entered into eight non-cancellable operating lease agreements for ten office spaces expiring through December 2023. As of December 31, 2020, upon adoption of FASB ASU 2016-02, the Company recognized approximately RMB 2.7 million right of use (“ROU”) assets and same amount of lease liabilities based on the present value of the future minimum rental payments of leases, using a weighted average discount rate of 7% based on duration of lease terms. One ROU asset and lease liability was recognized during the year ended December 31, 2021. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases generally do not contain options to extend at the time of expiration and the weighted average remaining lease terms are 1 year.

Operating lease expenses are allocated between the cost of revenue and selling, research and development, general, and administrative expenses. Rent expenses for the years ended December 31, 2020 and 2021 was RMB 741,200 and RMB 1,548,254 (USD 242,837), respectively.

VIYI was established under the laws of Cayman Islands on September 24, 2020 with authorized share of 1,000,000,000 ordinary shares of par value USD 0.0001 each and 300,000,000 shares outstanding.

During the years ended December 31, 2020 and 2021, the Company’s shareholders contributed RMB 8,098,075 and nil to the Company.

The Company’s ability to pay dividends is primarily dependent on the Company receiving distributions of funds from its subsidiary. Relevant PRC statutory laws and regulations permit payments of dividends by SZ Weiyixin, Shanghai Weimu, and Shenzhen Yitian, Shenzhen Qianhai, YY Online, Wuhan 233, Korgas 233, Weidong, Shenzhen Viwotong, Shanghai Guoyu, Korgas Guoyu and Korgas Weidong (collectively “VIYI PRC entities”) only out of its retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations reflected in the accompanying consolidated financial statements prepared in accordance with U.S. GAAP differ from those reflected in the statutory financial statements of VIYI PRC entities.

As a result of the foregoing restrictions, VIYI PRC entities are restricted in their ability to transfer their assets to the Company. Foreign exchange and other regulation in the PRC may further restrict VIYI PRC entities from transferring funds to the Company in the form of dividends, loans and advances. As of December 31, 2021, amounts restricted are the paid-in-capital and statutory reserve of VIYI PRC entities, which amounted to RMB 192,640,959 (USD 30,214,872).

As of December 31, 2020 and 2021, VIYI PRC entities collectively attributed RMB 4,964,820 and RMB 9,420,703 (USD 1,477,595), of retained earnings for their statutory reserves, respectively.

In the opinion of management and the Company’s PRC legal counsel, (i) the ownership structure of the Company is in compliance with existing PRC laws and regulations; (ii) the Contractual Arrangements are valid and binding, and do not result in any violation of PRC laws or regulations currently in effect; and (iii) the business operations of Shenzhen Yitian and the VIE are in compliance with existing PRC laws and regulations in all material respects.

However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws and regulations. Accordingly, the Company cannot be assured that PRC regulatory authorities will not ultimately take a contrary view to the foregoing opinion of its management. If the current corporate structure of the Company or the Contractual Arrangements is found to be in violation of any existing or future PRC laws and regulations, the Company may be required to restructure its corporate structure and operations in the PRC to comply with changing and new PRC laws and regulations. In the opinion of management and the PRC counsel, the likelihood of loss in respect of the Company’s current corporate structure or the Contractual Arrangements is remote based on current facts and circumstances.

It is uncertain whether any new PRC laws, rules or regulations relating to variable interest entity structures will be adopted or if adopted, what they would provide. In particular, in January 2015, the Ministry of Commerce, or MOC, published a discussion draft of the proposed Foreign Investment Law for public review and comments. Among other things, the draft Foreign Investment Law expands the definition of foreign investment and introduces the principle of “actual control” in determining whether a company is considered a foreign-invested enterprise, or an FIE. Under the draft Foreign Investment Law, variable interest entities would also be deemed as FIEs, if they are ultimately “controlled” by foreign investors, and would be subject to restrictions on foreign investments. However, the draft law has not taken a position on what actions will be taken with respect to the existing companies with the “variable interest entity” structure, whether or not these companies are controlled by Chinese parties. It is uncertain when the draft will be signed into law and whether the final version will have any substantial changes from the draft. Substantial uncertainties exist with respect to the enactment timetable, interpretation and implementation of draft PRC Foreign Investment Law and how it may impact the viability of the Company’s current corporate structure, corporate governance and business operations. If the ownership structure, contractual arrangements and business of the company are found to be in violation of any existing or future PRC laws or regulations, or the Company fails to obtain or maintain any of the required permits or approvals, the relevant governmental authorities would have broad discretion in dealing with such violation, including levying fines, confiscating the Company’s income, shutting down its servers, discontinuing or placing restrictions or onerous conditions on the Company’s operations, requiring the Company to undergo a costly and disruptive restructuring, restricting or prohibiting its use of proceeds from this offering to finance its business and operations in China and taking other regulatory or enforcement actions that could be harmful to the Company’s business. Any of these actions could cause significant disruption to the Company’s business operations and could severely damage its reputation, which would in turn materially and adversely affect its business, financial condition and results of operations.

Moreover, If VIE or the registered shareholders fail to perform their respective obligations under the contractual arrangements, the Company may incur substantial costs and expend substantial resources to enforce its rights. All of these contractual arrangements are governed by and interpreted in accordance with PRC laws, and disputes arising from these contractual arrangements will be resolved through arbitration or litigation in the PRC. There are very few precedents and little official guidance as to how contractual arrangements in the context of a variable interest entity should be interpreted or enforced under PRC laws. There remain significant uncertainties regarding the outcome of arbitration or litigation. These uncertainties could limit its ability to enforce these Contractual Arrangements. In the event the Company is unable to enforce these contractual arrangements or the Company experiences significant delays or other obstacles in the process of enforcing these contractual arrangements, the Company may not be able to exert effective control over the VIE and may lose control over the assets owned by Shenzhen Yitian. The financial performance may be adversely and materially affected as a result and the Company may not be eligible to consolidate the financial results of Shenzhen Yitian into its financial results.

The ongoing outbreak of the novel coronavirus (COVID-19) has spread rapidly to many parts of the world. In March 2020, the World Health Organization declared the COVID-19 as a pandemic. The pandemic has resulted in quarantines, travel restrictions, and the temporary closure of stores and business facilities in China from February to mid-March in 2020. All of the Company’s business operations and the workforce are concentrated in China in 2020, so the Company closed offices and implemented work-from-home policy during that period. Due to the nature of the Company’s business, the impact of the closure on the operational capabilities was not significant. The resurgence of COVID-19 variant in last quarter of 2021in South East Asia has negatively impacted VIYI’s subsidiary Fe-da’ operations. As a result from reducing revenue projections due to supply chain shortage, Fe-da recorded a goodwill impairment charge of approximately RMB 18.5 million (USD 2.9 million). Potential impact to the Company’s results of operations for 2022 will also depend on economic impact due to the pandemic and if any future resurgence of the virus in Asia, which are beyond the Company’s control. There is no guarantee that the Company’s revenues will grow or remain at a similar level year over year in 2022 and beyond.

The following tables present summary information by segment for the years ended December 31, 2020 and 2021:

The Company evaluated all events and transactions that occurred after December 31, 2021 up through the date the Company issued these consolidated financial statements.

The Company did not have significant capital and other commitments, long-term obligations, or guarantees as of December 31, 2020 and 2021.

This MERGER AGREEMENT (the “Agreement”), dated as of June 10, 2021 (the “Signing Date”), by and among VIYI Algorithm Inc., a Cayman Islands exempted company (the “Company”), Venus Acquisition Corporation, a Cayman Islands exempted company (the “Purchaser”), Venus Merger Sub Corp., a Cayman Islands exempted company and wholly-owned subsidiary of the Purchaser (the “Merger Sub”) and WiMi Hologram Cloud Inc., a Cayman Islands company and the legal and beneficial owner of a majority of the issued and outstanding voting securities of the Company (“Majority Shareholder”).

WHEREAS, Purchaser is a blank check company under the United States’ federal securities laws and was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses;

WHEREAS, Merger Sub is a newly formed entity and was formed for the purpose of effectuating the Merger (as defined below);

WHEREAS, upon the terms and subject to the conditions of this Agreement and in accordance with the Cayman Islands Companies Act (as revised) (the “Cayman Companies Act”), the parties hereto desire and intend to effect a business combination transaction whereby the Merger Sub will merge with and into the Company, with the Company being the surviving entity (the Company is hereinafter referred to for the periods from and after the Merger Effective Time (as defined below) as the “Surviving Corporation”) and becoming a wholly owned Subsidiary of Purchaser (the “Merger”) on the terms and subject to the conditions set forth in this Agreement and simultaneously with the Closing Purchaser will change its name to “MicroAlgo Inc.”;

WHEREAS, for U.S. Federal income tax and applicable state income tax purposes, (a) the Merger is intended to constitute a “reorganization” within the meaning of Section 368(a) of the Code (the “Intended Tax Treatment”) and (b) this Agreement is intended to constitute and hereby is adopted as a “plan of reorganization” with respect to the Merger within the meaning of Treasury Regulations Sections 1.368-2(g) and 1.368-3(a) for purposes of Sections 354, 361 and 368 of the Code and the Treasury Regulations thereunder;

WHEREAS, concurrently with the execution and delivery of this Agreement, the Purchaser and the Company Shareholders (as defined below) are entering into a registration rights agreement substantially in the form attached hereto as Exhibit A (the “Registration Rights Agreement”);

WHEREAS, in connection with the Closing, each of the Purchaser, Yolanda Management Corporation, a British Virgin Islands company (the “IPO Sponsor”) and the Company Shareholders will enter into a lock-up agreement substantially in the form attached hereto as Exhibit B (collectively, the “Lock-up Agreements”);

WHEREAS, concurrently with the execution and delivery of this Agreement, the Purchaser has received a backstop agreement substantially in the form attached hereto as Exhibit C (the “Backstop Agreement”);

WHEREAS, simultaneously with the execution of this Agreement, Purchaser, the Company, and all of the Company Shareholders have entered into a voting and transaction support agreement in the form attached hereto as Exhibit F (“Company Transaction Support Agreement”) whereby the Company’s Shareholders holding all of the voting securities of the Company shall agree that in the event that any Company Shareholders or their respective Affiliates own or control any Purchaser Ordinary Shares prior to the vote at the Purchaser’s Shareholders’ Meeting (as defined below) to approve the Merger and the Transactions, they shall vote or cause to be voted all such Purchaser Ordinary Shares then held by them or their respective Affiliates in favour of the Merger and the Transactions and shall not redeem any such Purchaser Ordinary Shares;

WHEREAS, in connection with the Closing (as defined below), the Purchaser, the Majority Shareholder and certain escrow agent to be jointly selected by the parties (the “Escrow Agent”) will enter into an escrow agreement substantially in the customary form used by the Escrow Agent for similar transactions and consistent with the terms of this Agreement (the “Escrow Agreement”);

WHEREAS, in connection with the Closing, the Purchaser, the Company and each of the Company Shareholders will enter into a non-compete and non-solicitation agreement substantially in the form attached hereto as Exhibit E (collectively, the “Non-Compete Agreements”).

WHEREAS, the board of directors of the Company has (i) determined that this Agreement, the Merger and the other Transactions are in the best interests of the Company, (ii) approved and declared advisable this Agreement and the execution, delivery and performance of this Agreement and the consummation of the Transactions (as defined below), and (iii) resolved to recommend the adoption of this Agreement by the shareholders of the Company;

WHEREAS, the Company Shareholders have adopted a resolution by written consent approving this Agreement and the Transactions (“Company Shareholder Approval”);

WHEREAS, the board of directors of the Purchaser has unanimously (a) determined that this Agreement, the Merger and the Transactions are fair to, advisable and in the best interests of the Purchaser and constitute a “Business Combination” as such term is defined in the Purchaser’s Organizational Documents (as defined below), (b) approved and declared advisable this Agreement and the execution, delivery and performance of this Agreement and the consummation of the Transactions, (c) resolved to recommend the adoption of this Agreement by the shareholders of the Purchaser, and (d) directed that this Agreement be submitted to the shareholders of the Purchaser for their adoption;

WHEREAS, the board of directors of the Merger Sub has (i) determined that the Merger is fair to, advisable and in the best interests of Merger Sub, (ii) approved and declared advisable this Agreement and the execution, delivery and performance of this Agreement and the consummation of the Transactions and (b) the sole shareholder of Merger Sub has adopted a resolution by written consent approving this Agreement and the Transactions; and

WHEREAS, in furtherance of the Transactions, Purchaser shall provide an opportunity to the Purchaser Shareholders to have their Purchaser Ordinary Shares redeemed for consideration on the terms and subject to the conditions set forth in the Purchaser Organizational Documents and the Trust Agreement in conjunction with obtaining the Purchaser Shareholders’ Approval.

NOW, THEREFORE, in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth below, and the representations, warranties, covenants and agreements contained in this Agreement, and intending to be legally bound hereby, the parties accordingly agree as follows:

“Action” means any legal action, suit, claim, investigation, hearing or proceeding, including any audit, claim or assessment for Taxes or otherwise.

“Additional Purchaser SEC Documents” has the meaning given to such term in Section 5.12.

“Adjournment Proposal” has the meaning given to such term in Section 6.5(a).

“Affiliate” means, with respect to any Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control with such Person.

“Alternative Transaction” has the meaning given to such term in Section 6.2.

“Anti-Corruption Laws” means, collectively, the Foreign Corrupt Practices Act (FCPA), the UK Bribery Act 2010, the anti-corruption and anti-bribery Laws of the PRC for the prevention of punishment of public or commercial corruption or bribery, including the PRC Criminal Law and the PRC Anti-Unfair Competition Law, OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions,

the UN Convention against Corruption, United States Currency, Foreign Transactions Reporting Act of 1970, as amended, and any other applicable anti-bribery or anti-corruption Laws related to combatting bribery, corruption and money laundering.

“Authority” means any governmental, regulatory or administrative body, agency or authority, any court or judicial authority, any arbitrator, any relevant stock exchange, or any public, private or industry regulatory authority, whether international, national, federal, state, or local.

“Books and Records” means all books and records, ledgers, employee records, customer lists, files, correspondence, and other records of every kind (whether written, electronic, or otherwise embodied) owned or used by a Person or in which a Person’s assets, the business or its transactions are otherwise reflected, other than stock books and minute books.

“Business Combination Proposal” has the meaning given to such term in Section 6.5(a).

“Business Day” means any day other than a Saturday, Sunday or a legal holiday on which commercial banking institutions in New York or the PRC are authorized to close for business.

“Change of Name Proposal” has the meaning given to such term Section 6.5(a).

“Closing Payment Shares” means, with respect to a Company Shareholder other than the Majority Shareholder, such number of the Consideration Shares to be received by such Company Shareholder at Closing, and with respect to the Majority Shareholder, such number of the Consideration Shares equal to the result of the total number of Consideration Shares payable to the Majority Shareholder less the number of Escrow Shares, in each case as set forth opposite of each Company Shareholder’s name in the Allocation Statement and subject to any adjustments made pursuant to Section 3.1.

“Company Balance Sheet” has the meaning given to such term in Section 4.8(a).

“Company Disclosure Schedule” has the meaning given to such term in Article IV.

“Company Material Adverse Effect” means a material adverse change or a material adverse effect upon on the assets, liabilities, condition (financial or otherwise), prospects, net worth, management, earnings, cash flows, business, operations or properties of the Company Group and its business, taken as a whole, whether or not arising from transactions in the Ordinary Course of business, provided, however, that “Company Material Adverse Effect” shall not include any event, occurrence, fact, condition or change, directly or indirectly, arising out of or attributable to: (i) general economic or political conditions; (ii) conditions generally affecting the industries in which the Company Group operates; (iii) any changes in financial, banking or securities markets in general, including any disruption thereof and any decline in the price of any security or any market index or any change in prevailing interest rates; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening thereof; (v) any action required or permitted by this Agreement or any action taken (or omitted to be taken) with the written consent of or at the written request of the Purchaser Parties; (vi) any changes in applicable Laws or accounting rules or the enforcement, implementation or interpretation thereof; (vii) the announcement, pendency or completion of the transactions contemplated by this Agreement, including losses or threatened losses of employees, customers, suppliers, distributors or others having relationships with the Company; (viii) any natural or man-made disaster or acts of God; or (ix) any failure by the Company Group to meet any internal or published projections, forecasts or revenue or earnings predictions (provided that the underlying causes of such failures, subject to the other provisions of this definition, shall not be excluded).

“Company Share Rights” means all options, warrants, rights, or other securities (including debt instruments) to purchase, convert or exchange into Company Shares.

“Company Transaction Expenses” means all fees, costs and expenses of the Company incurred prior to and through the Closing Date in connection with the negotiation, preparation and execution of this Agreement and the Transaction Documents, the performance and compliance with all Transaction Documents and conditions contained herein to be performed or complied with at or prior to the Closing, the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby, including fees, costs, expenses and disbursements of counsel, accountants, advisors and consultants of the Company, whether paid or unpaid as of the Closing.

“Consideration Shares” means such number of Purchaser Ordinary Shares equal to the Valuation divided by SPAC Per Share Redemption Price, rounded up to the nearest whole number.

“Contracts” means all contracts, agreements, leases (including equipment leases, car leases and capital leases), licenses, commitments, client contracts, statements of work (SOWs), sales and purchase orders and similar instruments, oral or written, to which the Company and/or any of its Subsidiary is a party or by which any of its respective assets are bound, including any entered into by the Company and/or any of its Subsidiary in compliance with Section 6.1 after the date hereof and prior to the Closing.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by Contract or otherwise; and the terms “Controlled” and “Controlling” shall have the meaning correlative to the foregoing.

“Director Appointment Proposal” has the meaning given to such term in Section 6.5(a).

“D&O Indemnified Parties” has the meaning given to such term in Section 8.5.

“Environmental Laws” shall mean all applicable Laws that prohibit, regulate or control any Hazardous Material or any Hazardous Material Activity, including, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, the Resource Recovery and Conservation Act of 1976, the Federal Water Pollution Control Act, the Clean Air Act, the Hazardous Materials Transportation Act and the Clean Water Act.

“Escrow Shares” means such number of the Consideration Shares to be held in escrow after the Closing and released pursuant to the terms and conditions of this Agreement and the Escrow Agreement, being such number of Consideration Shares representing 2% of the total number of Consideration Shares payable to the Majority Shareholder as set forth opposite of the Majority Shareholder’s name in the Allocation Statement and subject to any adjustments made pursuant to Section 3.1.

“Financial Statements” has the meaning given to such term in Section 4.8(a).

“Fraud Claim” means any claim based in whole or in part upon fraud, willful misconduct or intentional misrepresentation.

“GAAP” means generally accepted accounting principles in the United States as in effect from time to time

“Governmental Approval” means each and any of consent, approval, license or other action by or in respect of, or registration, declaration or filing with, any Authority.

“Government Official” means (a) an officer or employee of any national, regional, local or other component of government, (b) a director, officer or employee of any entity in which a government or any component of a government possesses a majority interest; (c) a political party or political party official; and (e) any individual who is acting in an official capacity for any government, component of a government, or political party.

“Hazardous Material” shall mean any material, emission, chemical, substance or waste that has been designated by any governmental Authority to be radioactive, toxic, hazardous, a pollutant or a contaminant.

“Hazardous Material Activity” shall mean the transportation, transfer, recycling, storage, use, treatment, manufacture, removal, remediation, release, exposure of others to, sale, labeling, or distribution of any Hazardous Material or any product or waste containing a Hazardous Material, or product manufactured with ozone depleting substances, including, any required labeling, payment of waste fees or charges (including so-called e-waste fees) and compliance with any recycling, product take-back or product content requirements.

“IPO” means the initial public offering of Purchaser pursuant to the IPO Prospectus.

“IPO Prospectus” means the prospectus of Purchaser’s offering of 4,600,000 units (including the exercised over-allotment option) dated February 8, 2021 and filed with the SEC (Registration No. 333-251507).

“Indebtedness” with respect to any Person, without duplication, any obligations, contingent or otherwise, in respect of (a) the principal of and premium (if any) in respect of all indebtedness for borrowed money, including accrued interest and any per diem interest accruals, (b) amounts drawn (including any accrued and unpaid interest) on letters of credit, bank guarantees, bankers’ acceptances and other similar instruments (solely to the extent such amounts have actually been drawn), (c) the principal of and premium (if any) in respect of obligations evidenced by bonds, debentures, notes and similar instruments, (d) the termination value of interest rate protection agreements and currency obligation swaps, hedges or similar arrangements (without duplication of other indebtedness supported or guaranteed thereby), (e) the principal component of all obligations to pay the deferred and unpaid purchase price of property and equipment which have been delivered, including “earn outs” and “seller notes” but excluding payables arising in the Ordinary Course, (f) breakage costs, prepayment or early termination premiums, penalties, or other fees or expenses payable as a result of the consummation of the Transactions in respect of any of the items in the foregoing clauses (a) through (e), and (g) all Indebtedness of another Person referred to in clauses (a) through (f) above guaranteed directly or indirectly, jointly or severally.

“Indemnification Notice” has the meaning given to such term in Section 12.2.

“Intellectual Property Right” means any and all intellectual property, industrial property, and proprietary rights worldwide, whether registered or unregistered, including rights in and to the following in any jurisdiction throughout the world: (a) all patents and utility models and inventions (whether patentable or unpatentable and whether or not reduced to practice) and invention disclosures and all improvements thereto (“Patents”), (b) all trademarks, service marks, certification marks, collective marks, trade dress, logos, slogans, trade names, corporate and business names, and other indicia of source, including all goodwill symbolized thereby or associated therewith (“Trademarks”), (c) Internet domain names and rights of publicity and in social media usernames, handles, and accounts; (d) all works of authorship, copyrightable works, all copyrights and related rights (“Copyrights”), (e) all designs, industrial designs and mask works (“Designs”), (f) all trade secrets, know-how, proprietary information (such as processes, techniques, formulae, compositions, data analytics, source code, models and methodologies), business or financial information (such as customer and supplier lists, pricing and cost information and business and marketing plans and proposals), technical or engineering information (such as technical data, algorithms, designs, drawings and specifications) and other non-public or confidential information (“Trade Secrets”), (g) Technology, (h) Software, (i) any registrations or applications for registration for any of the foregoing, and any provisionals, divisionals, continuations, continuations-in-part, renewals, reissuances, revisions, re-examinations and extensions of any of the foregoing (as applicable), each of which shall be deemed to be included in Patents, Copyrights, Trademarks, Designs or the foregoing clause (c), as applicable, and (j) analogous rights to those set forth above.

“Intended Tax Treatment” has the meaning given to such term in the Recitals.

“Law” means any domestic or foreign, federal, state, municipality or local law, statute, ordinance, code, principle of common law, act, treaty or order of general applicability of any applicable Authority, including rule or regulation promulgated thereunder.

“Liabilities” means any and all liabilities, Indebtedness, claims, or obligations of any nature (whether absolute, accrued, contingent or otherwise, whether known or unknown, whether direct or indirect, whether matured or unmatured and whether due or to become due), including Tax Liabilities due or to become due.

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, and any conditional sale or voting agreement or proxy, including any agreement to give any of the foregoing.

“Non-Compete Agreements” has the meaning given to such term in the Recitals.

“Order” means any decree, order, judgment, writ, award, injunction, rule or consent of or by an Authority.

“Ordinary Course” means, with respect to an action taken or refrained from being taken by a Person, that such action or omission is taken in the ordinary course of the normal day-to-day operations of such Person, including any reasonable actions taken or refrained from being taken in good faith in response to COVID-19, any COVID-19 Measures or any change in such COVID-19 Measures or interpretations whether taken prior to or following the date of this Agreement.

“Organizational Documents” means, with respect to any Person, its certificate of incorporation and bylaws, memorandum and articles of association or similar organizational documents, in each case, as amended.

“Organizational Documents Proposal” has the meaning given to such term in Section 6.5(a).

“Permitted Liens” means (i) all defects, exceptions, restrictions, easements, rights of way and encumbrances disclosed in policies of title insurance which have been made available to the Purchaser Parties; (ii) mechanics’, carriers’, workers’, repairers’ and similar statutory Liens arising or incurred in the Ordinary Course of business for amounts (A) that are not delinquent, (B) that are not material to the business, operations and financial condition of the Company and/or any of its Subsidiaries so encumbered, either individually or in the aggregate, and (C) that not resulting from a breach, default or violation by the Company and/or any of its Subsidiaries of any Contract or Law; and (iii) liens for Taxes not yet due and payable or which are being contested in good faith by appropriate proceedings (and for which adequate accruals or reserves have been established in accordance to the applicable accounting principles and standards).

“Person” means an individual, corporation, partnership (including a general partnership, limited partnership or limited liability partnership), limited liability company, association, trust or other entity or organization, including a government, domestic or foreign, or political subdivision thereof, or an agency or instrumentality thereof.

“Per Share Merger Consideration” means the quotient obtained by dividing (a) the aggregate number of Consideration Shares, by (b) the aggregate number of Company Shares outstanding as of immediately prior to the Effective Time.

“Permit” means any permit, license, approval, certificate, qualification, consent or authorization issued by an Authority.

“Proxy Statement” means the proxy statement forming part of the Proxy/Registration Statement filed with the SEC, with respect to the Purchaser Shareholders’ Meeting and the transactions contemplated hereby, to be used for the purpose of soliciting proxies from Purchaser Shareholders to approve the transactions contemplated hereby.

“Proxy/Registration Statement” has the meaning given to such term in Section 6.5(a).

“Purchaser Board Recommendation” has the meaning given to such term in Section 6.5(b).

“Purchaser Founder Shares” means the (a) 1,150,000 ordinary shares of Purchaser, par value $0.001 per share, issued to the IPO Sponsor prior to the IPO and (b) 225,000 ordinary shares of Purchaser, par value $0.001 per share, issued to the IPO Sponsor concurrently with the completion of the IPO.

“Purchaser Financial Statements” has the meaning given to such term in Section 5.12(b).

“Purchaser Material Adverse Effect” means a material adverse change or a material adverse effect upon on the assets, liabilities, condition (financial or otherwise), prospects, net worth, management, earnings, cash flows, business, operations or properties of the Purchaser Parties and its business, taken as a whole, whether or not arising from transactions in the Ordinary Course of business, or that would prevent or materially delay the Closing from happening, provided, however, that “Purchaser Material Adverse Effect” shall not include any event, occurrence, fact, condition or change, directly or indirectly, arising out of or attributable to: (i) general economic or political conditions; (ii) conditions generally affecting the industries in which each of the Purchaser Parties operates; (iii) any changes in financial, banking or securities markets in general, including any disruption thereof and any decline in the price of any security or any market index or any change in prevailing interest rates; (iv) acts of war (whether or not declared), armed hostilities or terrorism, or the escalation or worsening thereof; (v) any action required or permitted by this Agreement or any action taken (or omitted to be taken) with the written consent of or at the written request of the Company; (vi) any matter of which Company is aware on the date hereof; (vii) any changes in applicable Laws or accounting rules or the enforcement, implementation or interpretation thereof; (viii) the announcement, pendency or completion of the transactions contemplated by this Agreement, including losses or threatened losses of employees, customers, suppliers, distributors or others having relationships with the Purchaser Parties; (ix) any natural or man-made disaster or acts of God; or (x) any failure by the Purchaser Parties to meet any internal or published projections, forecasts or revenue or earnings predictions (provided that the underlying causes of such failures, subject to the other provisions of this definition, shall not be excluded).

“Purchaser Ordinary Shares” means the ordinary shares of Purchaser, par value $0.001 per share.

“Purchaser Parties” means, collectively, the Purchaser and the Merger Sub, and “Purchaser Party” means either of them.

“Purchaser Post-Closing Officers” has the meaning given to such term in Section 8.4.

“Purchaser Rights” means the right to receive one-tenth (1/10) of one Purchaser Ordinary Share upon consummation of a business combination of the Purchaser.

“Purchaser SEC Documents” has the meaning given to such term in Section 5.12.

“Purchaser Securities” means the Purchaser Shares, Purchaser Rights, Purchaser Units, Purchaser Warrants, collectively.

“Purchaser Share Redemption” means the right of the holders of Purchaser Shares to redeem all or a portion of their Purchaser Shares (in connection with the transactions contemplated by this Agreement or otherwise) as set forth in Organizational Documents of Purchaser and the Trust Agreement.

“Purchaser Shareholders’ Approval” means the approval, at the Purchaser Shareholders’ Meeting where a quorum is present, of the Transaction Proposals comprising of (a) in the case of the Business Combination Proposal, an ordinary resolution in accordance with the Organizational Documents of Purchaser and applicable Law requiring the affirmative vote of at least a majority of the votes cast by the holders of the issued Purchaser Shares present in

person or represented by proxy at the Purchaser Shareholders’ Meeting and entitled to vote on such matter; (b) in the case of the Share Capital Proposal, an ordinary resolution in accordance with the Organizational Documents of Purchaser and applicable Law requiring the affirmative vote of at least a majority of the votes cast by the holders of the issued Purchaser Shares present in person or represented by proxy at the Purchaser Shareholders’ Meeting and entitled to vote on such matter (c) in the case of the Change of Name Proposal, a special resolution in accordance with the Organizational Documents of Purchaser and applicable Law requiring the affirmative vote of at least a two-thirds (2/3) majority of the votes cast by the holders of the issued Purchaser Shares present in person or represented by proxy at the Purchaser Shareholders’ Meeting and entitled to vote on such matter; (d) in the case of the Organizational Documents Proposal, a special resolution in accordance with the Organizational Documents of Purchaser and applicable Law requiring the affirmative vote of at least a two-thirds (2/3) majority of the votes cast by the holders of the issued Purchaser Shares present in person or represented by proxy at the Purchaser Shareholders’ Meeting and entitled to vote on such matter (e) in the case of the Director Appointment Proposal, an ordinary resolution in accordance with the Organizational Documents of Purchaser and applicable Law requiring the affirmative vote of at least a majority of the votes cast by the holders of the issued Purchaser Shares present in person or represented by proxy at the Purchaser Shareholders’ Meeting and entitled to vote on such matter; and (f) in the case of the Adjournment Proposal, if required, an ordinary resolution in accordance with the Organizational Documents of Purchaser and applicable Law requiring the affirmative vote of at least a majority of the votes cast by the holders of the issued Purchaser Shares present in person or represented by proxy at the Purchaser’s Shareholders’ Meeting and entitled to vote on such matter.

“Purchaser Shares” means the Purchaser Founder Shares and the Purchaser Ordinary Shares, as applicable.

“Purchaser Shareholders’ Meeting” has the meaning given to such term in Section 6.5(b).

“Purchaser Transaction Expenses” means all fees, costs and expenses of Purchaser and Merger Sub incurred prior to and through the Closing Date in connection with the negotiation, preparation and execution of this Agreement, the performance and compliance with all Transaction Documents and conditions contained herein to be performed or complied with at or prior to the Closing, the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby, including fees, costs, expenses and disbursements of counsel, accountants, advisors and consultant of Purchaser and Merger Sub, whether paid or unpaid as of the Closing and the Transfer Taxes.

“Purchaser Unit” means a unit of the Purchaser comprised of one Purchaser Ordinary Share, one Purchaser Warrant and one Purchaser Right.

“Purchaser Warrants” means the warrants to purchase one-half of one Purchaser Ordinary Share at a price of $11.50 per whole share, subject to adjustments as described in the IPO Prospectus.

“Real Property” means, collectively, all real properties and interests therein (including the right to use), together with all buildings, fixtures, trade fixtures, plant and other improvements located thereon or attached thereto; all rights arising out of use thereof (including air, water, oil and mineral rights); and all subleases, franchises, licenses, permits, easements and rights-of-way which are appurtenant thereto.

“Registration Rights Agreement” means has the meaning given to such term in the Recitals.

“Sanctions and Export Control Laws” means any applicable Law related to (a) import and export controls, including the U.S. Export Administration Regulations, 15 C.F.R. Parts 730-774), and the Export Controls Act of 2018, 22 U.S.C. 2751 et seq., the Israeli Control of Products and Services Declaration (Engagement in Encryption), 1974, the Export Control Law of the PRC, (b) economic or financial sanctions imposed, administered or enforced by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, the European Union, any European Union Member State, the United Nations, Her Majesty’s Treasury of the United Kingdom, or the PRC, or (c) anti-boycott measures.

“Share Capital Proposal” has the meaning given to such term in Section 6.5(a).

“Software” means any (a) computer, mobile, or device programs, systems, applications and code, including any software implementations of algorithms, models and methodologies and any source code, object code, firmware, middleware, APIs, development and design tools, applets, compilers and assemblers, (b) databases and compilations, including any and all libraries, data and collections of data whether machine readable, on paper or otherwise, (c) descriptions, flow-charts and other work product used to design, plan, organize and develop any of the foregoing, (d) technology supporting, and the contents and audiovisual displays of, any internet site(s) and (e) documentation, other works of authorship and media, including user manuals and training materials, relating to or embodying any of the foregoing or on which any of the foregoing is recorded.

“SPAC Per Share Redemption Price” means the lower of (i) per share redemption price paid to each holder of Purchaser Shares exercising such holder’s right to redeem such holder’s Purchaser Shares (in connection with the transactions contemplated by this Agreement) as set forth in the Organizational Documents of the Purchaser and the Trust Agreement, and (ii) $10.10.

“Subsidiary” or “Subsidiaries” means one or more entities of which at least fifty percent (50%) of the capital stock or share capital or other equity or voting securities are Controlled or owned, directly or indirectly, by the respective Person.

“Tangible Personal Property” means all tangible personal property and interests therein, including machinery, computers and accessories, furniture, office equipment, communications equipment, automobiles, trucks, forklifts and other vehicles owned or leased by the Company and other tangible property.

“Tax(es)” means any federal, state, local or foreign tax, charge, fee, levy, custom, duty, deficiency, or other assessment of any kind or nature imposed by any Taxing Authority (including any income (net or gross), gross receipts, profits, windfall profit, sales, use, goods and services, ad valorem, franchise, license, withholding, employment, social security, workers compensation, unemployment compensation, employment, payroll, transfer, excise, import, real property, personal property, intangible property, occupancy, recording, minimum, alternative minimum, environmental or estimated tax), including any liability therefor as a transferee or successor, as a result of Treasury Regulation Section 1.1502-6 or similar provision of applicable Law or as a result of any Tax sharing, indemnification or similar agreement, together with any interest, penalty, additions to tax or additional amount imposed with respect thereto.

“Taxing Authority” means the United States Internal Revenue Service and any other Authority responsible for the collection, assessment or imposition of any Tax or the administration of any Law relating to any Tax.

“Tax Return” means any return, information return, declaration, claim for refund or credit, report or any similar statement, and any amendment thereto, including any attached schedule and supporting information, whether on a separate, consolidated, combined, unitary or other basis, that is filed or required to be filed with any Taxing Authority in connection with the determination, assessment, collection or payment of a Tax or the administration of any Law relating to any Tax.

“Transaction Documents” mean collectively, this Agreement, the Escrow Agreement, the Backstop Agreement, the Lock-up Agreement, the Registration Rights Agreement, the Non-Compete Agreements, and the Company Transaction Support Agreement and any other agreements, documents or certificates entered into or delivered pursuant hereto or thereto.

“Transaction Expenses” means collectively, the Purchaser Transaction Expenses and the Company Transaction Expenses.

“Transactions” means, collectively, the Merger and each of the other transactions contemplated by this Agreement or any of the other Transaction Documents.

“Transfer Taxes” means all transfer, documentary, sales, use, real property, stamp, registration and other similar Taxes, fees and costs (including any associated penalties and interest) incurred in connection with this Agreement.

“Trust Agreement” means the trust agreement made as of February 8, 2021 by and between the Purchaser, the Trustee and the Transfer Agent.

“Trustee” means Wilmington Trust, National Association acting as trustee pursuant to the Trust Agreement.

Section 2.1 Merger. Upon and subject to the terms and conditions set forth in this Agreement and in accordance with the applicable provisions of Cayman Companies Act, on the Closing Date, Merger Sub shall be merged with and into the Company. Following the Merger, the separate corporate existence of Merger Sub shall cease, and the Company shall continue as the Surviving Corporation in the Merger.

Section 2.2 Closing; Effective Time. Unless this Agreement is earlier terminated in accordance with Article XI, the closing of the Merger (the “Closing”) shall be deemed to have taken place at the New York City office of DLA Piper on a date no later than five (5) Business Days after the satisfaction or waiver of all the conditions set forth in Article X, or at such other place and time as the Company and the Purchaser Parties may mutually agree upon. The parties may participate in the Closing via electronic means. The date on which the Closing actually occurs is hereinafter referred to as the “Closing Date”. At the Closing, the parties hereto shall execute a plan of merger in the form attached hereto as Annex 2 (the “Plan of Merger”) and the parties hereto shall cause the Merger to be consummated by filing the Plan of Merger (and other documents required by Cayman Companies Act) with the Registrar of Companies in the Cayman Islands on the same day as the Closing Date in accordance with the relevant provisions of Cayman Companies Act (the time of such filings being the “Effective Time”). At the Closing, the Purchaser shall file a copy of the Purchaser Shareholders’ Approval with the Registrar of Companies in the Cayman Islands on the same day as the Closing Date and (i) apply for a change of name from “Venus Acquisition Corporation” to “MicroAlgo Inc.” (ii) file the increase of the authorized share capital of the Purchaser to US$200,000 divided into 200,000,000 ordinary shares of US$0.001 par value per share (iii) file the amended and restated memorandum and articles of association of the Purchaser amended in accordance with Section 2.5(b) and (iv) file the appointment and/or removal of the directors and officers of the Purchaser in accordance with Section 2.4.

Section 2.3 Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in this Agreement, the Plan of Merger and the applicable provisions of Cayman Companies Act. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the property, rights, privileges, agreements, powers and franchises, debts, liabilities, duties and obligations of the Merger Sub shall become the property, rights, privileges, agreements, powers and franchises, debts, liabilities, duties and obligations of the Surviving Corporation, which shall include the assumption by the Surviving Corporation of any and all agreements, covenants, duties and obligations of the Merger Sub set forth in this Agreement to be performed after the Effective Time.

(a) From and after the Effective Time, the composition of the board of directors of the Surviving Corporation shall be the same as the composition set forth in Section 8.4(a).

(b) From and after the Effective Time, the directors and officers of the Company as of immediately prior to the Effective Time shall be the directors and officers of each of the Purchaser and the Surviving Corporation from and after the Effective Time, in each case, each to hold office in accordance with the respective Organizational Documents of the Purchaser and the Surviving Corporation.

(a) The memorandum and articles of association of the Company in effect immediately prior to the Effective Time shall be the memorandum and articles of association of the Surviving Corporation from and after the Effective Time until thereafter amended in accordance with their terms and under the applicable Laws.

(b) The memorandum and articles of association of the Purchaser from and after the Effective Time shall be in the form attached hereto as Exhibit G.

Section 2.6 Taking of Necessary Action; Further Action. If, at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Surviving Corporation with full right, title and interest in, to and under, and/or possession of, all assets, property, rights, privileges, powers and franchises of the Merger Sub and the Company, the officers and directors of the Merger Sub and the Company are fully authorized in the name of their respective corporations or otherwise to take, and will take, all such lawful and necessary action, so long as such action is not inconsistent with this Agreement.

Section 2.7 Section 368 Reorganization. The parties to this Agreement hereby (i) adopt this Agreement as a “plan of reorganization” within the meaning of Section 1.368-2(g) of the United States Treasury Regulations, (ii) agree to file and retain such information as shall be required under Section 1.368-3 of the United States Treasury Regulations, and (iii) agree to file all Tax and other informational returns on a basis consistent with such characterization. Each party will use commercially reasonable efforts, and agrees to cooperate with the other parties and to provide to the other parties such information and documentation as may be necessary, proper or advisable, to cause the Merger to so qualify, and will not knowingly take an action that would cause the Merger to fail to qualify, as a reorganization within the meaning of Section 368(a) of the Code. Notwithstanding the foregoing or anything else to the contrary contained in this Agreement, the parties acknowledge and agree that no party is making any representation or warranty as to the qualification of the Merger as a reorganization under Section 368 of the Code or as to the effect, if any, that any transaction consummated on, after or prior to the Effective Time has or may have on any such reorganization status. Each of the parties acknowledges and agrees that each (i) has had the opportunity to obtain independent legal and tax advice with respect to the transactions contemplated by this Agreement, and (ii) is responsible for paying its own Taxes, including any adverse Tax consequences that may result if the Merger is determined not to qualify as a reorganization under Section 368 of the Code.

Section 3.1 Allocation Statement. Annex 1 attached hereto sets forth preliminarily the number of Purchaser Ordinary Shares issuable to each Company Shareholder pursuant to this Agreement in respect of the Consideration Shares, subject to Purchaser’s updates prior to the Effective Time (the “Allocation Statement”). If, between the date of this Agreement and the Closing, the outstanding Company Shares or Purchaser Shares shall have been changed into a different number of shares or a different class, by reason of any share issuance, share dividend, subdivision, reclassification, reorganization, recapitalization, split, combination or exchange of shares, or any similar event shall have occurred, then any number, value (including dollar value) or amount contained herein which is based upon the number of Company Shares or Purchaser Shares, as applicable, will be appropriately adjusted to provide to the holders of Company Shares or the holders of Purchaser Shares, as applicable, the same economic effect as contemplated by this Agreement prior to such event; provided, however, that this Section 3.1 shall not be construed to permit Purchaser or the Company to take any action with respect to their respective securities that is prohibited by the terms and conditions of this Agreement.

(a) Share Capital of Merger Sub. At the Effective Time, on the terms and subject to the conditions set forth herein and in the Plan of Merger, by virtue of the Merger and without any action on the part of the Purchaser, the Merger Sub, or the holders of any securities of the Company or Merger Sub, each share of the share capital of

Merger Sub that is issued and outstanding immediately prior to the Effective Time shall be converted into one (1) fully paid and nonassessable ordinary share of the Surviving Corporation. Such ordinary shares of the Surviving Corporation into which the ordinary shares of Merger Sub are so converted shall be the only shares of the Surviving Corporation that are issued and outstanding immediately after the Effective Time.

(b) Share Capital of Company. At the Effective Time, on the terms and subject to the conditions set forth herein and in the Plan of Merger, by virtue of the Merger and without any action on the part of the Purchaser, the Merger Sub, the Company or the holders of any securities of the Company or Merger Sub, each Company Share issued and outstanding immediately prior to the Effective Time, shall be cancelled and automatically converted into the right to receive, without interest, the Per Share Merger Consideration. For avoidance of any doubt, each Company Share to be converted into the right to receive the Per Share Merger Consideration as provided in this Section 3.2(b) shall be automatically cancelled and shall cease to exist, and each Company Shareholder holding such Company Shares will cease to have any rights with respect to such Company Shares, except the right to receive the Per Share Merger Consideration.

(c) No Liability. Notwithstanding anything to the contrary in this Section 3.2, none of Surviving Corporation or any party hereto shall be liable to any person for any amount properly paid to a public official pursuant to any applicable abandoned property, escheat or similar law.

(i) Closing Payment Shares. Upon and subject to the terms and conditions of this Agreement and the Plan of Merger, at the Closing, Purchaser shall deliver or cause to be delivered the Closing Payment Shares, represented by book-entry, to each holder of Company Shares that have been converted into the right to receive the Consideration Shares, as set forth in the Allocation Statement.

(ii) Escrow Shares. Upon and subject to the terms and conditions of this Agreement and the Plan of Merger, at the Closing, the Purchaser shall deliver or cause to be delivered the aggregate Escrow Shares, represented by book-entry, to the Escrow Agent to be held and released pursuant to the terms of this Agreement and the Escrow Agreement.

(b) No fraction shares. No certificates or scrip or book-entry credit representing fractional Purchaser Ordinary Shares will be issued pursuant to the Merger, and such fractional share interests will not entitle the owner thereof to vote or to any rights of a shareholder of the Purchaser. In the event any holder of Company Share would otherwise be entitled to receive a fraction of a share of Purchaser Ordinary Shares (after aggregating all fractional shares of Purchaser Ordinary Shares issuable to such holder), such fractional share shall be rounded up to the nearest whole share. The parties acknowledge that any such adjustment was not separately bargained-for consideration but merely represents a mechanical rounding off for purposes of avoiding the expense and inconvenience to Purchaser that would otherwise be caused by the issuance of fractional shares.

(c) Lost, Stolen or Destroyed Certificates. In the event any certificates for any Company Share shall have been lost, stolen or destroyed, the Purchaser shall deliver or cause to be delivered in exchange for such lost, stolen or destroyed certificates and for each such share, upon the making of an affidavit of that fact by the holder thereof; provided, however, that Purchaser may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificates to deliver a bond in such sum as it may reasonably direct as indemnity against any claim that may be made against Purchaser with respect to the certificates alleged to have been lost, stolen or destroyed.

(d) Company Register of Members. After the Effective Time, the register of members of the Company shall be closed, and thereafter there shall be no further registration on the register of members of the Surviving Corporation of transfers of Company Shares that were issued and outstanding immediately prior to the Effective Time.

The Company and the Majority Shareholder hereby jointly and severally represent and warrant to the Purchaser Parties that each of the following representations and warranties is true, correct and complete as of the date of this Agreement and as of the Closing Date (or, if such representations and warranties are made with respect to a certain date, as of such date), except as set forth in the Company’s disclosure schedule delivered by the Company to the Purchaser Parties in connection with this Agreement (the “Company Disclosure Schedule”) (each of which qualifies (a) the correspondingly numbered representation, warranty or covenant specified therein and (b) such other representations, warranties or covenants where its relevance as an exception to (or disclosure for purposes of) such other representation, warranty or covenant is reasonably apparent on its face or cross-referenced):

Section 4.1 Corporate Existence and Power. The Company is an exempted company duly incorporated, validly existing and in good standing under the Laws of the Cayman Islands and its Subsidiaries are duly organized, validly existing and in good standing under the laws of the jurisdiction in which they were formed. The Company has all requisite power and authority, corporate and otherwise, and all governmental licenses, franchises, Permits, authorizations, consents and approvals necessary and required to own and operate its properties and assets and to carry on its business as presently conducted, other than as would not be reasonably expected to, individually or in the aggregate, have a Company Material Adverse Effect.

(a) The execution, delivery and performance by the Company of this Agreement and the Transaction Documents (to which it is a party to) and the consummation by the Company of the transactions contemplated hereby and thereby are within the corporate powers of the Company and have been duly authorized by all necessary corporate action on the part of Company to the extent required by their respective Organizational Documents, applicable Laws or any Contract to which it is a party or by which its securities are bound. This Agreement has been duly executed and delivered by the Company and the Company Shareholders and it constitutes, and upon their execution and delivery, the Transaction Documents (to which it is a party to) will constitute, a valid and legally binding agreement of the Purchaser Parties, enforceable against them in accordance with their representative terms. The Company Shareholder Approval is the only vote of any of Company Shares necessary in connection with the entry into this Agreement by the Company, and the consummation of the transactions contemplated hereby, including the Closing.

(b) The board of directors of the Company has, by duly adopted resolutions, (i) approved this Agreement, the Merger and the transactions contemplated by this Agreement, (ii) determined that this Agreement, the Merger and the transactions contemplated by this Agreement are advisable and in the best interests of the Company and the Company Shareholders, (iii) directed that the adoption of this Agreement be submitted to approve by the Company Shareholders and (iv) resolved to recommend that the Company Shareholders approve this Agreement, the Merger and the transactions contemplated by this Agreement.

Section 4.3 Governmental Authorization. No consent, approval or authorization of, or designation, declaration to or filing with, notice to, or any other action by or in respect of, any governmental Authority or other Person is required on the part of the Company with respect to the Company’s execution, delivery and performance of this Agreement and each Transaction Document to which it is a party or the consummation of the transactions contemplated hereby and thereby, except for (a) the filing of the Plan of Merger in accordance with the Cayman Companies Act, (b) the SEC declaration of effectiveness of the Proxy/Registration Statement, and (c) any consents, approvals, authorizations, designations, declarations, filings, notices or actions, the absence of which would not reasonably be expected to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole.

Section 4.4 Non-Contravention. The execution, delivery or performance by the Company of this Agreement or any Transaction Documents to which it is a party does not and will not (a) contravene or conflict with the organizational or constitutive documents of the Company, (b) contravene or conflict with or constitute a violation of any provision of any Law or Order binding upon or applicable to the Company, (c) constitute a default under or breach of (with or without the giving of notice or the passage of time or both) or violate or give rise to any right of termination, cancellation, amendment or acceleration of any right or obligation of the Company or require any payment or reimbursement or to a loss of any material benefit relating to the business to which the Company is

entitled under any provision of any Permit, Contract or other instrument or obligations binding upon the Company or by which any of the Company Shares, or any of the Company’s assets is or may be bound or any Permit, or (d) result in the creation or imposition of any Lien on any of the Company Shares, (e) cause a loss of any material benefit relating to the business to which the Company is entitled under any provision of any Permit or Contract binding upon the Company, or (f) result in the creation or imposition of any Lien (except for Permitted Liens) on any of the Company’s material assets, in the cases of (a) to (d), other than as would not be reasonably expected to, individually or in the aggregate, have a Company Material Adverse Effect.

Section 4.5 Capital Structure. Section 4.5 of the Company Disclosure Schedule sets forth the Company’s equity structure. The Company has an authorized capital of $100,000 consisting of 1,000,000,000 shares, par value $0.0001 per share of which 300,000,000 are issued and outstanding as of the date hereof. No Company Share is held in its treasury. All of the issued and outstanding Company Shares have been duly authorized and validly issued, are fully paid and non-assessable, and are not subject to any preemptive rights or have been issued in violation of any preemptive or similar rights of any Person. There are no: (a) outstanding Company Share Rights; (b) outstanding subscriptions, options, warrants, rights (including phantom stock rights), calls, commitments, understandings, conversion rights, rights of exchange, plans or other agreements or contractual rights of any kind providing for the purchase, redemption, issuance or sale of any share of the Company, or (c) to the knowledge of the Company, agreements with respect to any of the Company Share, including any voting trust, other voting agreement or proxy with respect thereto. There are no outstanding bonds, debentures, notes or other Indebtedness of the Company or any of its Subsidiaries having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matter for which the equityholders of any Subsidiary of the Company may vote. None of the Company or any of its Subsidiaries is a party to any equityholders agreement, voting agreement or registration rights agreement relating to the equity interests of the Company or any Subsidiary of the Company. There are no declared but unpaid dividends or other distributions with regard to any issued and outstanding equity interests of the Company or any Subsidiary of the Company.

Section 4.6 Organizational Documents. The Company has not taken any action in violation or derogation of its Organizational Documents, other than as would not be reasonably expected to, individually or in the aggregate, have a Company Material Adverse Effect. A true and complete copy of the certificate of formation, of the Company, and a true and correct copy of the articles and memorandum of association of the Company have been provided to the Purchaser Parties and each is in full force and effect and the Company is not in violation of any of the provisions thereof.

Section 4.7 Subsidiaries. Section 4.7 of the Company Disclosure Schedule sets forth the corporate details of each Subsidiary of the Company. All of the outstanding equity securities of each Subsidiary of the Company are duly authorized and validly issued, duly registered and non-assessable (if applicable), were offered, sold and delivered in material compliance with all applicable securities Laws, and are owned by the Company or one of its Subsidiaries free and clear of all Liens (other than those, if any, imposed by such Subsidiary’s Organizational Documents); and (ii) there are no outstanding or authorized options, warrants, rights, agreements, subscriptions, convertible securities or commitments to which any Subsidiary of the Company is a party or which are binding upon any Subsidiary of the Company providing for the issuance or redemption of any shares or other equity interests in or of any Subsidiary of the Company. The Subsidiaries have been duly incorporated, formed or organized and are validly existing and in good standing, where applicable, under the Laws of their respective jurisdiction of incorporation, formation or organization and have the power and authority to own or lease their respective properties and to conduct their respective businesses as they are now being conducted. Each Subsidiary of the Company is duly licensed or qualified and in good standing as a foreign corporation (or other entity, if applicable) in each jurisdiction in which its ownership or lease of property or the character of its activities is such as to require it to be so licensed or qualified or in good standing, as applicable, except where the failure to be so licensed or qualified or in good standing would not reasonably be expected to be have a Material Adverse Effect. True and complete copies of the organizational documents of the Subsidiaries of the Company have been made available to the Purchaser Parties, and are in full force and effect and such Subsidiaries are not in violation of any of the provisions thereof.

(b) The Financial Statements are complete and accurate and fairly present in all material respects, in conformity with its applicable accounting standards applied on a consistent basis in all material respects, the financial position of the Company as of the dates thereof and the results of operations of the Company for the periods reflected therein.

(c) The systems of internal accounting controls maintained by the Company and its Subsidiaries are sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; and (iii) material information is communicated to management as appropriate.

(d) Neither the Company nor any of its Subsidiaries is a party to, or is subject to any commitment to become a party to, any joint venture, off-balance sheet partnership or any similar Contract (including any Contract or arrangement relating to any transaction or relationship between or among the Company and any of its Subsidiaries, on the one hand, and any unconsolidated Affiliate, on the other hand), including any structured finance, special purpose or limited purpose entity or Person, or any “off-balance sheet arrangements” (as defined in Item 303(a) of Regulation S-K under the Securities Act), in each case, where the result, purpose or effect of such Contract is to avoid disclosure of any material transaction involving, or material liabilities of, the Company or any of its Subsidiaries in the Financial Statements.

(e) Neither the Company nor any of its Subsidiaries has received from any employee of the Company or its Subsidiaries any written or, to the knowledge of the Company, oral complaint, allegation, assertion or claim with respect to unlawful or potentially unlawful activity regarding accounting, internal accounting controls, auditing practices, procedures, methodologies or methods of the Company or any of its Subsidiaries, and the Company and its Subsidiaries have not independently identified or received any written notice from their independent accountants regarding any of the foregoing.

(f) The Financial Statements have been prepared in accordance with Regulation S-X and reviewed by the Company’s independent auditor in accordance with PCAOB Auditing Standard 4105. The Financial Statements have been audited in accordance with PCAOB auditing standards by a PCAOB-qualified auditor that was independent under Rule 2-01 of Regulation S-X under the Securities Act.

(g) As of the date hereof, other than as set forth in the Financial Statements and as described in the notes thereto, that have arisen in the Ordinary Course of the Company’s business as currently conducted or incurred in connection with the transactions contemplated by this Agreement, and as would not be reasonably expected to, individually or in the aggregate, have a Company Material Adverse Effect, the Company and its Subsidiaries do not have any (i)Indebtedness, whether or not contingent, for borrowed money, or (ii) Indebtedness evidenced by any note, bond, debenture, mortgage or other debt instrument or debt security or similar instrument.

Section 4.9 Books and Records. All Contracts, documents, and other papers or copies thereof delivered to the Purchaser Parties by or on behalf of the Company are true and authentic. The Books and Records reflect fairly in all material respects the transactions and dispositions of assets of and the providing of services by the Company. All accounts, books and ledgers of the Company have been properly and accurately kept and completed in all material respects, and there are no material inaccuracies or discrepancies of any kind contained or reflected therein.

Section 4.10 Absence of Certain Changes. Since the Balance Sheet Date, the Company has conducted the business in the Ordinary Course consistent with past practices. Without limiting the generality of the foregoing, since the Balance Sheet Date, there has not been:

(b) any transaction, Contract or other instrument entered into, or commitment made, by the Company relating to its business, or any of the Company’s assets (including the acquisition or disposition of any assets) or any relinquishment by the Company of any Contract or other right, in either case other than transactions and commitments in the Ordinary Course of business consistent in all material respects, including kind and amount, with past practices and those contemplated by this Agreement;

(c) (i) any redemption of, declaration, setting aside or payment of any dividend or other distribution with respect to any capital stock or share capital or other equity interests in the Company; (ii) any issuance by the Company of shares or of shares of capital stock or other equity interests in the Company (other than pursuant to any effective employee equity incentive plan), or (iii) any repurchase, redemption or other acquisition, or any amendment of any term, by the Company of any outstanding shares or shares of capital stock or other equity interests (other than pursuant to any effective employee equity incentive plan);

(d) (i) any creation or other incurrence of any Lien other than Permitted Liens on the Company Shares or any of the Company’s assets, and (ii) any making of any loan, advance or capital contributions to or investment in any Person by the Company, in each case other than in the Ordinary Course of business consistent with past practice of the Company;

(e) any material personal property damage, destruction or casualty loss or personal injury loss (whether or not covered by insurance) affecting the business or assets of the Company;

(f) any material labor dispute, other than routine individual grievances, or any material activity or proceeding by a labor union or representative thereof to organize any employees of the Company, which employees were not subject to a collective bargaining agreement at the Balance Sheet Date, or any lockouts, strikes, slowdowns, work stoppages or threats thereof by or with respect to any employees of the Company;

(g) any sale, transfer, lease to others or otherwise disposition of any of its material assets by the Company except for inventory, licenses or services sold in the Ordinary Course of business consistent with past practices or immaterial amounts of other Tangible Personal Property not required by its business;

(h) (i) any amendment to or termination of any Material Contract, (ii) any amendment to any material license or material permit from any Authority held by the Company, (iii) any receipt of any notice of termination of any of the items referenced in (i) and (ii); and (iv) a material default by the Company under any Material Contract, or any material license or material permit from any Authority held by the Company, other than in the cases of each of clauses (i) through (iv), as provided for in this Agreement or the transactions contemplated hereunder or as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect;

(i) other than in the Ordinary Course of business, any capital expenditure by the Company in excess in any fiscal month of $1,000,000 per one transaction or entering into any lease of capital equipment or property under which the annual lease charges exceed $15,000,000 in the aggregate by the Company;

(j) any institution of litigation, settlement or agreement to settle any litigation, action, proceeding or investigation before any court or governmental body relating to the Company or its property or suffering of any actual litigation, action, proceeding or investigation before any court or governmental body relating to the Company or its property, other than as would not be reasonably expected to, individually or in the aggregate, have a Company Material Adverse Effect;

(k) any loan of any monies to any Person or guarantee of any obligations of any Person by the Company, in excess of $5,000,000, other than accounts payable and accrued liabilities in the Ordinary Course of business consistent with past business;

(l) except as required by the appliable accounting principles and standards, any change in the accounting methods or practices (including, any change in depreciation or amortization policies or rates) of the Company or any revaluation of any of the assets of the Company;

(m) any material amendment to the Company’s Organizational Documents, or any engagement by the Company in any merger, consolidation, reorganization, reclassification, liquidation, dissolution or similar transaction, other than as provided for in this Agreement or the transactions contemplated hereunder;

(n) any acquisition of assets (other than acquisitions of inventory in the Ordinary Course of business consistent with past practice) or business of any Person, other than as would not be reasonably expected to, individually or in the aggregate, have a Company Material Adverse Effect;

(o) any material Tax election made by the Company outside of the Ordinary Course of business consistent with past practice, or any material Tax election changed or revoked by the Company; any material claim, notice, audit report or assessment in respect of Taxes settled or compromised by the Company; any annual Tax accounting period changed by the Company; any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax (other than an ordinary commercial agreement the principal purpose of which does not relate to Taxes) entered into by the Company; or any right to claim a material Tax refund surrendered by the Company; or

(p) any undertaking of any legally binding obligation to do any of the foregoing.

(a) The material items of Tangible Personal Property have no material defects, are in good operating condition, function in accordance with their intended uses (ordinary wear and tear excepted) and have been properly maintained, and are suitable for their present uses and meet all specifications and warranty requirements with respect thereto.

(b) Section 4.11(b) of the Company Disclosure Schedule sets forth the Company’s list of leased properties, The Company has good, valid and marketable title in and to, or in the case of the Leases and the assets which are leased or licensed pursuant to Contracts, a valid leasehold interest or license in or a right to use, all of their assets reflected on the Company Balance Sheet or acquired after Balance Sheet Date, other than as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect. Other than as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, the Company’s assets constitute all of the assets of any kind or description whatsoever, including goodwill, for the Company to operate its business immediately after the Closing in the same manner as the Business is currently being conducted.

Section 4.12 Litigation. There is no Action (or any basis therefore) pending against, or to the knowledge of the Company or the Majority Shareholder threatened against or affecting, the Company, any of its officers or directors, its business, or any Company Shares, or any of the Company’s assets or any Contract before any court, Authority or official or which in any manner challenges or seeks to prevent, enjoin, alter or delay the transactions contemplated hereby or by the Transaction Documents, other than as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect. There are no outstanding judgments against the Company that would reasonably to be expected to, individually or in the aggregate, have a Company Material Adverse Effect on the ability of the Company to enter into and perform its obligations under this Agreement. The Company is not, and has not been in the past two (2) years, subject to any proceeding with any Authority, other than as would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.

(a) Section 4.13(a) of Company Disclosure Schedule lists all material Contracts, oral or written (collectively, the “Material Contracts”) to which the Company is a party and which are currently in effect and constitute the following:

(i) all Contracts that require annual payments or expenses by, or annual payments or income to, the Company of $3,000,000 or more (other than standard purchase and sale orders entered into in the Ordinary Course of business consistent with past practice);

(ii) all sales, advertising, agency, lobbying, broker, sales promotion, market research, marketing or similar contracts and agreements, in each case requiring the payment of any commissions by the Company in excess of $3,000,000 annually;

(iii) all employment Contracts, employee leasing Contracts, and consultant and sales representatives Contracts with any current or former officer, director, employee or consultant of the Company or other Person, under which the Company (A) has continuing obligations for payment of annual compensation of

at least $500,000 (other than oral arrangements for at-will employment), (B) has material severance or post termination obligations to such Person (other than COBRA obligations), or (C) has an obligation to make a payment upon consummation of the transactions contemplated hereby or as a result of a change of control of the Company;

(iv) all Contracts creating a material joint venture, strategic alliance, management or similar agreement with an Affiliate, limited liability company and partnership agreements to which the Company is a party;

(v) all Contracts relating to any material acquisitions or dispositions of assets by the Company in excess of $3,000,000;

(vi) all Contracts for material licensing agreements, including Contracts licensing Intellectual Property Rights, other than (i) “shrink wrap” licenses, and (ii) non-exclusive licenses granted in the Ordinary Course of business;

(vii) all Contracts relating to material secrecy, confidentiality and nondisclosure agreements restricting the conduct of the Company or substantially limiting the freedom of the Company to compete in any line of business or with any Person or in any geographic area;

(viii) all Contracts relating to material patents, trademarks, service marks, trade names, brands, copyrights, trade secrets and other material Intellectual Property Rights of the Company;

(ix) all Contracts providing for material guarantees, indemnification arrangements and other hold harmless arrangements made or provided by the Company, including all ongoing agreements for repair, warranty, maintenance, service, indemnification or similar obligations;

(x) all Contracts with or pertaining to the Company to which any 5% Shareholder is a party;

(xi) all Contracts relating to property or assets (whether real or personal, tangible or intangible) in which the Company holds a leasehold interest and which involve (A) payments to the lessor thereunder in excess of $3,000,000 per month or (B) an Affiliate of the Company;

(xii) any Contract under which the Company or any of its Subsidiaries has (A) created, incurred, assumed or guaranteed (or may create, incur, assume or guarantee) indebtedness for money borrowed (excluding, for the avoidance of doubt, any intercompany arrangements solely between or among the Company or any of its Subsidiaries), (B) granted a Lien on its assets or group of assets, whether tangible or intangible, to secure any indebtedness for money borrowed, (C) extended credit to any Person (other than Contracts involving immaterial advances made to an employee of the Company or any of its Subsidiaries in the Ordinary Course of business as currently conducted) or (D) relating to outstanding Indebtedness, including financial instruments of indenture or security instruments (typically interest-bearing) such as notes, mortgages, loans and lines of credit, except any such Contract with a non-Affiliate with an aggregate outstanding principal amount not exceeding $3,000,000;

(xiii) any Contract relating to the voting or control of the equity interests of the Company or the election of directors of the Company (other than the Organizational Documents of the Company);

(xiv) any Contract that can be terminated, or the provisions of which are altered, as a result of the consummation of the transactions contemplated by this Agreement or any of the Transaction Documents to which the Company is a party; and

(xv) any Contract for which any of the benefits, compensation or payments (or the vesting thereof) with respect to a director, officer, employee or consultant of the Company will be increased or accelerated by the consummation of the transactions contemplated hereby or the amount or value thereof will be calculated on the basis of any of the transactions contemplated by this Agreement.

(b) Except as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, (i) each Material Contract is a valid and binding agreement, and is in full force and effect, and neither the Company nor, to the Company’s knowledge, any other party thereto, is in breach or default (whether with or without the passage of time or the giving of notice or both) under the terms of any such Material Contract,

(ii) the Company has not assigned, delegated, or otherwise transferred any of its rights or obligations with respect to any Material Contracts, or granted any power of attorney with respect thereto or to any of the Company’s assets, (iii) no Contract (A) requires the Company to post a bond or deliver any other form of security or payment to secure its obligations thereunder or (B) imposes any non-competition covenants that may be binding on, or restrict its business or require any payments by or with respect to Purchaser or any of its Affiliates.

(c) Except as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, none of the execution, delivery or performance by the Company of this Agreement or Transaction Documents to which the Company is a party or the consummation by the Company of the transactions contemplated hereby or thereby constitutes a default under or gives rise to any right of termination, cancellation or acceleration of any obligation of the Company or to a loss of any material benefit to which the Company is entitled under any provision of any Material Contract.

(d) Except would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, the Company is in compliance with all covenants, including all financial covenants, in all notes, indentures, bonds and other instruments or agreements evidencing any Indebtedness.

Section 4.14 Licenses and Permits. Section 4.14 of the Company Disclosure Schedule correctly lists each material Permits affecting, or relating in any way to, the Company’s business as currently conducted. Except as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, such Permits are valid and in full force and effect, and none of the Permits will, be terminated or impaired or become terminable as a result of the transactions contemplated hereby. Other than as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, the Company has all Permits necessary to operate its business. There is no outstanding notice of revocation, cancellation or termination of any Company Permit has been received by the Company or any of its Subsidiaries; there are no Actions pending or, to the knowledge of the Company, threatened that seek the revocation, suspension, withdrawal, adverse modification, cancellation or termination of any Company Permit. The consummation of the transactions contemplated by this Agreement will not cause the revocation, modification or cancellation of any Company Permits, except for any such revocation, modification or cancellation that would not reasonably be expected to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole.

Section 4.15 Compliance with Laws. Except as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, the Company is not in violation of, has not violated, and to the Company’s knowledge, is neither under investigation with respect to nor has been threatened to be charged with or given notice of any violation or alleged violation of, any Law, or judgment, order or decree entered by any court, arbitrator or Authority, domestic or foreign, nor is there any basis for any such charge and within the last 36 months the Company has not received any subpoenas by any Authority. The Company and each of its Subsidiaries has implemented, maintains, and complies in all material respects with internal compliance programs designed to detect and prevent violations of any applicable Laws.

(a) The Company and its Subsidiaries, and each of the Company’s and its Subsidiaries’ respective officers, directors, employees, agents, representatives or other persons acting on its behalf have complied with and are in compliance with Anti-Corruption Laws. Except as would not reasonably be expected to, individually or in the aggregate, have a Company Material Adverse Effect, neither the Company nor its directors or officers, nor, to the Company’s knowledge, any of their employees, agents, or any other Persons acting for or on behalf of any of the Company has, directly or knowingly indirectly (i) made, offered, promised, authorized, paid or received any unlawful bribes, kickbacks or other similar payments to or from any Person, (ii) made, offered, promised, authorized or paid any unlawful contributions to a domestic or foreign political party or candidate or (iii) otherwise made, offered, promised, authorized, paid or received any improper payment in violation of any Anti-Corruption Laws.

(b) The Company and each of its Subsidiaries has maintained and currently maintains (i) books, records and accounts which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company and its Subsidiaries, and (ii) internal accounting controls sufficient to provide reasonable assurances that all transactions and access to assets of the Company and its Subsidiaries were, have been and are executed only in accordance with management’s general or specific authorization.

(c) The Company and each of its Subsidiaries has in place policies, procedures and controls that are reasonably designed to promote and ensure compliance with Anti-Corruption Laws.

(d) None of the Company’s nor any of its Subsidiaries’ respective officers, directors, and to the Company’s knowledge, their respective employees is or was a Governmental Official or a close family member of a Government Official.

(e) To the Company’s knowledge, no governmental Authority is investigating or has in the past five (5) years conducted, initiated or threatened any investigation of the Company or any of its Subsidiaries, or the Company’s or its Subsidiaries’ respective officers or directors for alleged violation of Anti-Corruption Laws in connection with activities relating to the Company or any of its Subsidiaries.

(f) Neither the Company nor any of its Subsidiaries, nor any of the Company’s or its Subsidiaries’ Affiliates, nor any of the Company’s or its Subsidiaries’ directors, officers, employees, agents or representatives, is, or is owned or controlled by one or more Persons that are: (i) the subject of any sanctions administered by the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC) or the U.S. Department of State, the United Nations Security Council, the European Union, or other relevant sanctions authority (collectively, “Sanctions”), or (ii) located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Crimea, Cuba, Iran, North Korea, and Syria) or has conducted business with any Person or entity or any of its respective officers, directors, employees, agents, representatives or other Persons acting on its behalf that is located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Crimea, Cuba, Iran, North Korea, and Syria).

(a) Section 4.17 of the Company Disclosure Schedule sets forth a true, correct and complete list of all material Intellectual Properties owned by the Company.

(b) Within the past two (2) years, to the knowledge of the Company, the Company has not been sued or charged in writing with or been a defendant in any Action that involves a claim of infringement of any Intellectual Property Rights, and the Company has no knowledge of any other claim of infringement by the Company, and no knowledge of any continuing infringement by any other Person of any Intellectual Property Rights of the Company.

(c) The Company and its Subsidiaries own or have a valid and enforceable right to use any and all material Intellectual Property used or held for use in, or otherwise necessary for, the conduct of the business of the Company and its Subsidiaries as currently conducted. Except as would not have a Company Material Adverse Effect and to the knowledge of the Company, the current use by the Company of the Intellectual Property Rights does not infringe, and will not infringe, the rights of any other Person in any material respect.

(d) All employees, agents, consultants or contractors who have contributed to or participated in the creation or development of any material copyrights, patents or trade secrets on behalf of the Company or any predecessor in interest thereto, to the knowledge of the Company, either: (i) is a party to a “work-for-hire” agreement under which the Company is deemed to be the original owner/author of all property rights therein; or (ii) has executed an assignment or an agreement to assign in favor of the Company (or such predecessor in interest, as applicable) all right, title and interest in such material.

(e) Except as would not have a Company Material Adverse Effect, the execution, delivery or performance by the Company of this Agreement or any of the Transaction Documents to which it is a party or the consummation of the transactions contemplated hereby or thereby will cause any material item of Intellectual Property Rights owned, licensed, used or held for use by the Company immediately prior to the Closing to not be owned, licensed or available for use by the Company on substantially the same terms and conditions immediately following the Closing in any material respect.

(f) The Company has taken reasonable measures to safeguard and maintain the confidentiality and value of all trade secrets and other items of Company Intellectual Property that are confidential and all other confidential information, data and materials licensed by the Company or otherwise used in the operation of its business. The Company and its Subsidiaries have not disclosed, delivered, licensed or otherwise made available (other than to current and former employees, independent contractors and consultants who contributed to the development of

Software for the Company and who are bound by written confidentiality agreements), and do not have a duty or obligation (whether present, contingent, or otherwise) to disclose, deliver, license, or otherwise make available, any source code that embodies any owned Intellectual Property to any Person.

Section 4.18 Employees Except as would not have a Company Material Adverse Effect, the Company is not a party to or subject to any employment contract, consulting agreement, collective bargaining agreement, confidentiality agreement restricting the activities of the Company, non-competition agreement restricting the activities of the Company, or any similar agreement, and there has been no activity or proceeding by a labor union or representative thereof to organize any employees of the Company.

(a) Except as would not have a Company Material Adverse Effect, to the knowledge of the Company, no current employee of the Company, in the Ordinary Course of his or her duties, has breached any obligation to a former employer in respect of any covenant against competition or soliciting clients or employees or servicing clients or confidentiality or any proprietary right of such former employer; and the Company is not a party to any collective bargaining agreement, does not have any material labor relations disputes, and there is no pending representation question or union organizing activity respecting employees of the Company.

(b) Section 4.19(b) of the Company Disclosure Schedule contains a complete and accurate list of all current employees of the Company and its Subsidiaries as of the date hereof, which includes the following information with respect to each such employee: (i) the employee’s name, (ii) the department of the employee, (iii) the employee’s principal location of employment and (iv) the name of the applicable employer entity.

(a) All material Tax Returns required to be filed by or with respect to the Company have been filed within the requisite period (taking into account any extensions) and such Tax Returns are true, correct and complete in all material respects. All material Taxes due and payable by the Company have been or will be paid in a timely fashion or have been accrued for on the Financial Statements. No material deficiencies for any Taxes that are currently outstanding with respect to any Tax Returns of the Company have been asserted in writing by, and no written notice of any action, audit, assessment or other proceeding, in each case that is currently pending, with respect to such Tax Returns or any Taxes of the Company has been received from, any Taxing Authority, and no dispute or assessment relating to such Tax Returns or such Taxes with any such Taxing authority is currently outstanding. No claim that is currently outstanding has been made by the Taxing Authority in a jurisdiction where the Company does not file Tax Returns that the Company is or may be subject to taxation by that jurisdiction. The Company has not taken any action (nor permitted any action to be taken), and is not aware of any fact or circumstance, that would reasonably be expected to prevent, impair or impede the Intended Tax Treatment.

(b) Neither the Company nor any of its Subsidiaries is a party to or bound by any Tax sharing, indemnification or allocation agreement or other similar Contract, other than (A) any such agreement solely among the Company and its Subsidiaries, or (B) entered into in the Ordinary Course of business and not primarily related to Taxes.

(c) Neither the Company nor any of its Subsidiaries will be required to include any material item of income in, or exclude any material item of deduction from, taxable income for any Tax period (or portion thereof) ending after the Closing Date as a result of: (i) any change in method of accounting for a taxable period ending on or prior to the Closing; (ii) any “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign income Tax law) executed on or prior to the Closing; (iii) any installment sale or open transaction disposition made on or prior to the Closing; (iv) any prepaid amount received on or prior to the Closing outside the ordinary course of business; or (v) Section 965(a) of the Code (or any corresponding or similar provision of state, local or foreign Tax Law).

(a) The Company and its Subsidiaries are, and at all times since January 1, 2017 have been, in compliance with all Environmental Laws in all material respects, and there are no existing facts or circumstances which would reasonably be expected to prevent such compliance in the future and all Permits held by the Company pursuant to applicable Environmental Laws are in full force and effect and no appeal or any other Action is pending to revoke or modify any such Permit;

(b) no notice of violation, demand, request for information, citation, summons or order has been received by the Company relating to or arising out of any Environmental Laws, other than those relating to matters that have been fully resolved or that remain pending and, if adversely determined, would not reasonably be expected to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole;

(c) neither the Company nor any of its Subsidiaries has agreed to indemnify any other Person against liability under Environmental Laws, or to assume or undertake any liability of another Person under Environmental Laws;

(d) copies of all material written reports (in the case of reports with multiple drafts or versions, the final draft or version), notices of violation, orders, audits, assessments and all other material environmental reports, in the possession, custody or control of the Company or its Subsidiaries, relating to environmental conditions in, on or about the leased Real Property or to the Company’s or its Subsidiaries’ compliance with Environmental Laws have been made available to the Purchaser Parties.

Section 4.22 Finders’ Fees. With respect to the transactions contemplated by this Agreement, there is no investment banker, broker, finder or other intermediary which has been retained by or is authorized to act on behalf of the Company or any of Affiliates who might be entitled to any fee or commission from the Purchaser upon consummation of the transactions contemplated by this Agreement.

Section 4.23 Not an Investment Company. The Company is not an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.

Section 4.24 Affiliate Transactions. No (a) Company Shareholder, (b) former or current director, officer, manager, indirect or direct equityholder, optionholder or member of the Company or any of its Subsidiaries or (c) any Affiliate or “associate” or any member of the “immediate family” (as such terms are respectively defined in Rules 12b-2 and 16a-1 of the Securities Exchange Act of 1934), of any Person described in the foregoing clauses (a) or (b), in each case, other than the Company or any of its Subsidiaries (each a “Related Party”), is (i) a party to any Contract or business arrangement with the Company or any of its Subsidiaries, (ii) provides any services to, or is owed any money by or owes any money to, or has any claim or right against, the Company or any of its Subsidiaries (other than, in each case, compensation for services performed by a Person as director, officer, service provider or employee of the Company or any of its Subsidiaries and amounts reimbursable for routine travel and other business expenses in the Ordinary Course of Business), or (iii) directly or indirectly owns, or otherwise has any right, title or interest in, to or under, any tangible or intangible property, asset, or right that is, has been, or is currently planned to be used by the Company or any of its Subsidiaries (the Contracts, relationships, or transactions described in clauses (i) through (iii), the “Affiliate Transactions”).

Section 4.25 Proxy/Registration Statement. On the date the Proxy Statement is first mailed to the Purchaser Shareholders, and at the time of the meeting for the Purchaser Shareholders’ Approval, none of the information furnished by or on behalf of the Company or the Majority Shareholder in writing specifically for inclusion in the Proxy/Registration Statement will include any untrue statement of material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

Section 4.26 No other Representations or Warranties. Except as otherwise expressly provided in this Article IV (as may be modified by the Company Disclosure Schedule), Company hereby expressly disclaims and negates, any other express or implied representation or warranty whatsoever (whether at Law or in equity) with respect to Company and its Affiliates, and any matter relating to any of them, including their affairs, the condition, value or quality of the assets, liabilities, financial condition or results of operations, or with respect to the accuracy or completeness of any other information made available to the Purchaser Parties, their Affiliates or any of their respective representatives by, or on behalf of, Purchaser Parties, and any such representations or warranties

are expressly disclaimed. Without limiting the generality of the foregoing, except as expressly set forth in this Agreement (as may be modified by the Company Disclosure Schedule), neither the Company nor any other Person on behalf thereof has made or makes, any representation or warranty, whether express or implied, with respect to any projections, forecasts, estimates or budgets made available to the Purchaser Parties, or their Affiliates or any of their respective representatives of future revenues, future results of operations (or any component thereof), future cash flows or future financial condition (or any component thereof) of the Company (including the reasonableness of the assumptions underlying any of the foregoing), whether or not included in any presentation or in any other information made available to the Purchaser Parties, or their Affiliates or any of their representatives or any other Person, and any such representations or warranties are expressly disclaimed.

The Purchaser Parties hereby, jointly and severally, represent and warrant to the Company that, each of the following representations and warranties is true, correct and complete as of the date of this Agreement and as of the Closing Date (or, if such representations and warranties are made with respect to a certain date, as of such date):

Section 5.1 Corporate Existence and Power. Each of Purchaser and Merger Sub is an exempted company duly incorporated, validly existing and in good standing under the laws of the Cayman Islands. Each of the Purchaser Parties has all power and authority, corporate and otherwise, and all governmental licenses, franchises, Permits, authorizations, consents and approvals required to own and operate its properties and assets and to carry on its business as presently conducted and as proposed to be conducted.

Section 5.2 Authorization. The execution, delivery and performance by the Purchaser Parties of this Agreement and the Transaction Documents (to which it is a party to) and the consummation by the Purchaser Parties of the transactions contemplated hereby and thereby are within the corporate powers of the Purchaser Parties and have been duly authorized by all necessary corporate action on the part of Purchaser Parties to the extent required by their respective Organizational Documents, applicable Laws or any Contract to which it is a party or by which its securities are bound other than the Purchaser Shareholders’ Approval. This Agreement has been duly executed and delivered by the Purchaser Parties and it constitutes, and upon their execution and delivery, the Transaction Documents (to which it is a party to) will constitute, a valid and legally binding agreement of the Purchaser Parties, enforceable against them in accordance with their representative terms.

Section 5.3 Governmental Authorization. Other than as required under applicable Laws, neither the execution, delivery nor performance by the Purchaser Parties of this Agreement or any Transaction Documents requires any consent, approval, license or other action by or in respect of, or registration, declaration or filing with any Authority.

Section 5.4 Non-Contravention. The execution, delivery or performance by the Purchaser Parties of this Agreement or any Transaction Documents to which it is a party does not and will not (a) contravene or conflict with the organizational or constitutive documents of the Purchaser Parties, (b) contravene or conflict with or constitute a violation of any provision of any Law or Order binding upon or applicable to the Purchaser Parties, (c) constitute a default under or breach of (with or without the giving of notice or the passage of time or both) or violate or give rise to any right of termination, cancellation, amendment or acceleration of any right or obligation of the Purchaser Parties or require any payment or reimbursement or to a loss of any material benefit relating to the business to which the Company is entitled under any provision of any Permit, Contract or other instrument or obligations binding upon the Purchaser Parties or by which any of the Purchaser Shares, or any of the assets of the Purchaser Parties is or may be bound or any Permit, or (d) result in the creation or imposition of any Lien on any of the Purchaser Shares, (e) cause a loss of any material benefit relating to its business to which the Purchaser Parties is entitled under any provision of any Permit or Contract binding upon the Purchaser Parties, or (f) result in the creation or imposition of any Lien (except for Permitted Liens) on any of the Purchaser Parties’ material assets, in the cases of (a) to (d), other than as would not be reasonably expected to, individually or in the aggregate, have a Purchaser Material Adverse Effect

Section 5.5 Finders’ Fees. Other than Ladenburg Thalmann & Co Inc. there is no investment banker, broker, funder or other intermediary which has been retained by or is authorized to act on behalf of Purchaser or their Affiliates who might be entitled to any fee or commission from the Company, or any of its Affiliates upon consummation of the transactions contemplated by this Agreement or any of the Transaction Documents.

Section 5.6 Issuance of Shares. The Consideration Shares, when issued in accordance with this Agreement and the Plan of Merger, will be duly authorized and validly issued, and will be fully paid and nonassessable.

(a) At the date of this Agreement, the authorized share capital of Purchaser is US$50,000 divided into 50,000,000 Purchaser Ordinary Shares of which 6,050,000 Purchaser Ordinary Shares have been issued and are outstanding as of the date hereof including 1,375,000 of which are Purchaser Founder Shares. Except for the Purchaser Securities as described in the IPO prospectus, no other shares or other voting securities of Purchaser are issued, reserved for issuance or outstanding. All issued and outstanding Purchaser Ordinary Shares are, and all Consideration Shares, when issued, will be, duly authorized, validly issued, fully paid and nonassessable and not subject to or issued in violation of any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision of Cayman Islands Law, the Purchaser’s Organizational Documents or any contract to which Purchaser is a party or by which Purchaser is bound. Other than as described in the IPO Prospectus, there are no outstanding contractual obligations of Purchaser to repurchase, redeem or otherwise acquire any Purchaser Ordinary Shares or any capital equity of Purchaser. Other than as described in the IPO Prospectus, there are no outstanding contractual obligations of Purchaser to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any other Person.

(b) The authorized share capital of Merger Sub is $50,000 divided into 500,000,000 shares, par value $0.0001 per share (the “Merger Sub Share”) of which 10,000 shares of Merger Sub Share are issued and outstanding as of the date hereof. No other shares or other voting securities of Merger Sub are issued, reserved for issuance or outstanding. All issued and outstanding of Merger Sub Share(s) are duly authorized, validly issued, fully paid and nonassessable and not subject to or issued in violation of any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision of Cayman Islands Law, the Merger Sub’s Organizational Documents or any contract to which Merger Sub is a party or by which Merger Sub is bound. Except as set forth in the Merger Sub’s Organizational Documents, there are no outstanding contractual obligations of Merger Sub to repurchase, redeem or otherwise acquire any Merger Sub Share(s) or any share capital or equity of Merger Sub. There are no outstanding contractual obligations of Merger Sub to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any other Person.

Section 5.8 Information Supplied. None of the information supplied or to be supplied by the any Purchaser Party expressly for inclusion or incorporation by reference in the filings with the SEC and mailings to Purchaser’s stockholders with respect to the solicitation of proxies to approve the transactions contemplated hereby will, at the date of filing and/or mailing, as the case may be, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading (subject to the qualifications and limitations set forth in the materials provided by Purchaser or that is included in the Purchaser SEC Documents).

Section 5.9 Trust Account. As of the date of this Agreement, the Purchaser has at least $46,460,000 in the trust fund established by the Purchaser for the benefit of its public stockholders in a United States-based account at Wilmington Trust Company(the “Trust Account”), which is established by the Transfer Agent and maintained by the Trustee, and such monies are invested in “government securities” (as such term is defined in the Investment Company Act of 1940, as amended) and held in trust by the Trustee pursuant to the Trust Agreement. There are no separate Contracts, side letters or other arrangements or understandings (whether written or unwritten, express or implied) that would cause the description of the Trust Agreement in the Purchaser SEC Documents to be inaccurate or that would entitle any Person (other than Purchaser Shareholders holding Purchaser Shares sold in Purchaser’s IPO who shall have elected to redeem their Purchaser Shares pursuant to Purchaser’s Organizational Documents and the underwriters of Purchaser’s IPO with respect to deferred underwriting commissions) to any portion of the proceeds in the Trust Account. Prior to the Closing, none of the funds held in the Trust Account may be released other than to pay Taxes and payments with respect to all Purchaser Share Redemptions. There are no claims or proceedings pending or, to the knowledge of Purchaser Parties, threatened with respect to the Trust Account. Purchaser has performed all material obligations required to be performed by it to date under, and is not in default, breach or delinquent in performance or any other respect (claimed or actual) in connection with, the Trust Agreement, and no event has occurred which, with due notice or lapse of time or both, would constitute such a default or breach thereunder. As of the Effective Time, the obligations of Purchaser to dissolve or liquidate pursuant to Purchaser’s Organizational Documents shall terminate, and as of the Effective Time, Purchaser shall have no

obligation whatsoever pursuant to Purchaser’s Organizational Documents to dissolve and liquidate the assets of Purchaser by reason of the consummation of the transactions contemplated hereby. As of the date hereof, following the Effective Time, no Purchaser Shareholder shall be entitled to receive any amount from the Trust Account except to the extent such Purchaser Shareholder is exercising an Purchaser Share Redemption. As of the date hereof, assuming the accuracy of the representations and warranties of the Company herein and the compliance by the Company with its respective obligations hereunder, Purchaser has no reason to believe that any of the conditions to the use of funds in the Trust Account will not be satisfied or funds available in the Trust Account will not be available to Purchaser at the Effective Time.

Section 5.10 Listing. As of the date hereof, the Purchaser Units, Purchaser Ordinary Shares, Purchaser Warrants and Purchaser Rights are listed on the Nasdaq Capital Market, with trading symbols “VENAU,” “VENA,” “VENAW,” and “VENAR.” Purchaser is in compliance with the rules of Nasdaq and there is no Action pending or, to the knowledge of Purchaser, threatened against Purchaser by Nasdaq or the SEC with respect to any intention by such entity to deregister Purchaser Units, Purchaser Ordinary Shares, Purchaser Warrants or Purchaser Rights. No Purchaser Party has taken any action in an attempt to terminate the registration of Purchaser Units, Purchaser Ordinary Shares, Purchaser Warrants or Purchaser Rights.

Section 5.11 Board Approval. Each of the board of directors of the Purchaser and of the Merger Sub have, as of the date of this Agreement, unanimously (i) declared the advisability of the transactions contemplated by this Agreement and the Transaction Documents, (ii) determined that the transactions contemplated hereby and thereby are in the best interests of the stockholders or shareholders of the Purchaser Parties, as applicable, and (iii) solely with respect to the Purchaser Board, determined that the transactions contemplated hereby constitutes a “Business Combination” as such term is defined in Purchaser’s Organizational Documents.

(a) Each of the (i) Purchaser’s Annual Reports on Form 10-K for each fiscal year of Purchaser, beginning with the first year Purchaser was required to file such a form, (ii) Purchaser’s Quarterly Reports on Form 10-Q for each fiscal quarter of Purchaser beginning with the first quarter Purchaser was required to file such a form, (iii) all proxy statements relating to Purchaser’s meetings of shareholders (whether annual or special) held, and all information statements relating to shareholder consents, since the beginning of the first fiscal year referred to in clause (i) above, (iv) its Form 8-Ks filed since the beginning of the first fiscal year referred to in clause (i) above, and (v) all other forms, reports, registration statements and other documents filed by Purchaser with the SEC since Purchaser’s formation (the forms, reports, registration statements and other documents referred to in clauses (i), (ii), (iii), and (iv) above, together with any amendments, restatements or supplements thereto, are available in full without redaction on the SEC’s website through EDGAR. Purchaser has timely filed or furnished all statements, prospectuses, registration statements, forms, reports, schedules, and other documents, together with any amendments, restatements or supplements thereto, required to be filed or furnished by it with the SEC since its formation, pursuant to the Exchange Act, the Securities Act and all regulations and rules promulgated thereunder (collectively and as they have been amended since the time of their filing or furnishing, the “Purchaser SEC Documents”). Purchaser will timely file all of the foregoing documents with the SEC to the extent they are required by applicable Laws or rules subsequent to the date of this Agreement (the “Additional Purchaser SEC Documents”). Except with respect to the accounting treatment for warrants as described in the SEC pronouncement on April 12, 2021, each of the Purchaser SEC Documents, as of the respective date of its filing, and as of the date of any amendment, complied, and each of the Additional Purchaser SEC Documents will be prepared for and comply, in all material respects with the requirements of the Securities Act, the Exchange Act or the Sarbanes-Oxley Act applicable to such documents. As of the respective date of its filing (or if amended or superseded by a filing prior to the date of this Agreement or the Closing Date, then on the date of such filing), the Purchaser SEC Documents and the Additional Purchaser SEC Documents did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were or to be made, not misleading. As of the date of this Agreement, there are no outstanding or unresolved comments in comment letters received from the SEC with respect to any Purchaser SEC Documents. None of the Purchaser SEC Documents filed on or prior to the date of this Agreement is subject to ongoing SEC review or investigation as of the date of this Agreement.

(b) The financial statements and notes contained or incorporated by reference in the Purchaser SEC Documents (the “Purchaser Financial Statements”) are complete and accurate and fairly present in all material respects, in conformity with U.S. GAAP applied on a consistent basis in all material respects and Regulation S-X or Regulation S-K, as applicable, the financial position of the Purchaser as of the dates thereof and the results of operations of the Purchaser for the periods reflected therein. The Purchaser Financial Statements (i) were prepared from the Books and Records of the Purchaser; (ii) were prepared on an accrual basis in accordance with U.S. GAAP consistently applied; (iii) contain and reflect all necessary adjustments and accruals for a fair presentation of the Purchaser’s financial condition as of their dates; and (iv) contain and reflect adequate provisions for all material Liabilities for all material Taxes applicable to the Purchaser with respect to the periods then ended.

(c) Except as specifically disclosed, reflected or fully reserved against in the Purchaser Financial Statements, and for Liabilities and obligations of a similar nature and in similar amounts incurred in the Ordinary Course of business since the Purchaser’s formation, there are no material Liabilities, debts or obligations (whether accrued, fixed or contingent, liquidated or unliquidated, asserted or unasserted or otherwise) relating to the Purchaser. All debts and Liabilities, fixed or contingent, which should be included under U.S. GAAP on a balance sheet are included in the Purchaser Financial Statements.

Section 5.13 Litigation. There is no Action (or any basis therefore) pending against any Purchaser Party, any of its officers or directors or any of its securities or any of its assets or Contracts before any court, Authority or official or which in any manner challenges or seeks to prevent, enjoin, alter or delay the transactions contemplated hereby or by the Transaction Documents. There are no outstanding judgments against the Purchaser Parties. No Purchaser Party is, and has previously been, subject to any legal proceeding with any Authority.

Section 5.14 Compliance with Laws. No Purchaser Party is in violation of, has violated, under investigation with respect to any violation or alleged violation of, any Law, or judgment, order or decree entered by any court, arbitrator or Authority, domestic or foreign, nor is there any basis for any such charge and the Purchaser has not previously received any subpoenas by any Authority.

(a) Neither the Purchaser Parties, their directors or officers, nor, any of their employees, agents, or any other Persons acting for or on behalf of any of the Purchaser Parties has, directly or knowingly indirectly (i) made, offered, promised, authorized, paid or received any unlawful bribes, kickbacks or other similar payments to or from any Person, (ii) made, offered, promised, authorized or paid any unlawful contributions to a domestic or foreign political party or candidate or (iii) otherwise made, offered, promised, authorized, paid or received any improper payment in violation of any Anti-Corruption Laws.

(b) Neither the Purchaser Parties, their directors or officers, nor, any of their employees, agents, or any other Persons acting for or on behalf of any of the Purchaser Parties is or has been (i) a Person named on any Sanctions and Export Control Laws-related list of designated Persons maintained by an Authority; (ii) located, organized or resident in a country or territory which is itself the subject of or target of any Sanctions and Export Control Laws; (iii) an entity 50-percent or more owned, directly or indirectly, by one or more Persons described in clause (i) or (ii); or (iv) otherwise engaging in dealings with or for the benefit of any Person described in clauses (i) through (iii). Neither the Purchaser Parties, their directors or officers, nor, any of their employees, agents, or any other Persons in their capacity as such, is in violation of, or has been, in violation of, has been threatened to be charged with or given notice of any violation of, or is under investigation with respect to and has not been threatened to be charged with or given notice of any violation of, applicable Sanctions and Export Control Laws.

Section 5.16 Not an Investment Company. Each of the Purchaser Parties is not an “investment company” within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.

Section 5.17 Tax Matters All material Tax Returns required to be filed by or with respect to each Purchaser Party have been filed within the requisite period (taking into account any extensions) and such Tax Returns are true, correct and complete in all material respects. All material Taxes due and payable by the Company have been or will be paid in a timely fashion or have been accrued for on the Financial Statements. No material deficiencies for any Taxes that are currently outstanding with respect to any Tax Returns of the Purchaser Parties have been asserted in writing by, and no written notice of any action, audit, assessment or other proceeding, in each case that is currently

pending, with respect to such Tax Returns or any Taxes of the Purchaser Parties has been received from, any Taxing Authority, and no dispute or assessment relating to such Tax Returns or such Taxes with any such Taxing Authority is currently outstanding. No material claim that is currently outstanding has been made by the Taxing Authority in a jurisdiction where the Purchaser Parties do not file Tax Returns that any of the Purchaser Parties is or may be subject to taxation by that jurisdiction. Each of the Purchaser Parties has not taken any action (nor permitted any action to be taken), and is not aware of any fact or circumstance, that would reasonably be expected to prevent, impair or impede the Intended Tax Treatment. The Purchaser Parties have no current plan to dispose any asset of the Company Group after the Merger.

Section 5.18 Contracts. All material Contracts to which any of the Purchaser Parties is a party are available in full without redaction on the SEC’s website through EDGAR.

(a) Since its incorporation, each of the Purchaser Parties has not conducted any business activities other than activities related to Purchaser’s IPO or directed toward the accomplishment of a business combination. Except as set forth in the Organizational Documents of each of the Purchaser Parties or as otherwise contemplated by this Agreement and the Transaction Documents, there is no Contract to which any Purchaser Party is a party which has or would reasonably be expected to have the effect of prohibiting or impairing in any material respect any business practice of any Purchaser Party or any acquisition of property by any Purchaser Party or the conduct of business by each of the Purchaser Parties as currently conducted or as contemplated to be conducted as of the Closing. Except for the transactions contemplated under the Transaction Documents, each of the Purchaser Parties does not own or have a right to acquire, directly or indirectly, any interest or investment (whether equity or debt) in any corporation, partnership, joint venture, business, trust or other entity. Except for this Agreement and the Transaction Documents and the transactions contemplated hereby and thereby, each of the Purchaser Parties has no material interests, rights, obligations or liabilities with respect to, and is not party to, bound by or has its assets or property subject to, in each case whether directly or indirectly, any Contract or transaction which is, or would reasonably be interpreted as constituting, a business combination under Purchaser’s IPO Prospectus and the Organizational Documents of each of the Purchaser Parties.

(b) Merger Sub was formed solely for the purpose of effecting the transactions contemplated under the Transaction Documents and has not engaged in any business activities or conducted any operations other than in connection with the transactions contemplated under the Transaction Documents and has no, and at all times prior to the Closing except as expressly contemplated by the Transaction Documents, will have no, assets, liabilities or obligations of any kind or nature whatsoever other than those incident to its formation.

Section 5.20 Registration Statement and Proxy Statement. On the date the Proxy Statement is first mailed to the Purchaser’s Shareholders, and at the time of the meeting for the Purchaser Shareholders’ Approval, none of the information furnished by or on behalf of the Purchaser Parties in writing specifically for inclusion in the Proxy/Registration Statement will include any untrue statement of material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

Section 5.21 Backstop Investment. Purchaser has delivered to the Company true, correct and complete duly executed Backstop Agreement(s) providing for the acquisition or purchase by the named backstop provider(s) for up to an aggregate amount of USS$10,000,000 upon the terms and conditions therein, and each such Backstop Agreement is in full force and effect and has not been withdrawn or terminated, or otherwise amended or modified in any respect and no withdrawal or termination, amendment or modification in any material respect is contemplated by Purchaser. Each such Backstop Agreement is a legal, valid and binding obligation of Purchaser and the backstop investor(s) thereunder, and neither the execution or delivery by any party thereto nor the performance of any party’s obligations thereunder violates any Laws. There is no other agreement, side letter, or arrangement between any of the Purchaser Parties and any investor relating to any Backstop Agreement that could affect in any material respect the obligation of the backstop investors thereunder. No Purchaser Party knows, as of the date of this Agreement, any facts or circumstances that may reasonably be expected to result in any of the conditions set forth in any Backstop Agreement not being satisfied. No event has occurred that, with or without notice, lapse of time or both, would constitute a default or breach on the part of any of the Purchaser Parties under any material term or condition of any Backstop Agreement.

Section 5.22 Exclusivity of Representations and Warranties. Except as otherwise expressly provided in this Article V, Purchaser hereby expressly disclaims and negates, any other express or implied representation or warranty whatsoever (whether at Law or in equity) with respect to Purchaser and its Affiliates, and any matter relating to any of them, including their affairs, the condition, value or quality of the assets, liabilities, financial condition or results of operations, or with respect to the accuracy or completeness of any other information made available to the Company, its Affiliates or any of their respective representatives by, or on behalf of, Purchaser, and any such representations or warranties are expressly disclaimed. Without limiting the generality of the foregoing, except as expressly set forth in this Agreement, neither Purchaser nor any other Person on behalf thereof has made or makes, any representation or warranty, whether express or implied, with respect to any projections, forecasts, estimates or budgets made available to the Company, its Affiliates or any of their respective representatives of future revenues, future results of operations (or any component thereof), future cash flows or future financial condition (or any component thereof) of Purchaser (including the reasonableness of the assumptions underlying any of the foregoing), whether or not included in any presentation or in any other information made available to the Company or any of its representatives or any other Person, and any such representations or warranties are expressly disclaimed.

Section 5.23 No Outside Reliance Notwithstanding anything contained in this Agreement, each of the Purchaser Parties and its respective equityholders, partners, investors, members and representatives, has made their own investigation of the Company and its Subsidiaries and that neither the Company nor any of its Affiliates, agents, advisors or representatives is making any representation or warranty whatsoever, express or implied, beyond those expressly given by the Company in Article IV, including any implied warranty or representation as to condition, merchantability, suitability or fitness for a particular purpose or trade as to any of the assets of the Company or any of its Subsidiaries. Without limiting the generality of the foregoing, it is understood that any cost estimates, financial or other projections or other predictions that may be contained or referred to in the Company Disclosure Schedule or elsewhere, as well as any information, documents or other materials (including any such materials contained in any “data room” (whether or not accessed by the Purchaser Parties or its representatives) or reviewed by the Purchaser Parties otherwise) or management presentations that have been or shall hereafter be provided to Purchaser or any of its Affiliates, agents, advisors or representatives are not and will not be deemed to be representations or warranties of the Company, any of its Subsidiaries, or Company Shareholders, and no representation or warranty is made as to the accuracy or completeness of any of the foregoing. Except as otherwise expressly set forth in this Agreement, each of the Purchaser Parties understands and agrees that any assets, properties and business of the Company and any of its Subsidiaries are furnished “as is”, “where is” and subject to and except as otherwise provided in the representations and warranties contained in Article IV, with all faults and without any other representation or warranty of any nature whatsoever.

(a) From the date hereof through the Closing Date, each party shall, and shall cause its Subsidiaries to, conduct their respective business only in the Ordinary Course, (including the payment of accounts payable and the collection of accounts receivable), consistent with past practices, and shall not enter into any material transactions without the prior written consent of the other party, and shall use its best efforts to preserve intact its business relationships with employees, clients, suppliers and other third parties. Without limiting the generality of the foregoing, from the date hereof until and including the Closing Date, without the other party’s prior written consent (which shall not be unreasonably withheld), the Company and the Purchaser Parties shall not:

(i) materially amend, modify or supplement its Organizational Documents other than pursuant to this Agreement;

(ii) amend, waive any provision of, terminate prior to its scheduled expiration date, or otherwise compromise in any way, any Contract or any other right or asset of the Company or the Purchaser Parties, which involve payments in excess of $5,000,000;

(iii) modify, amend or enter into any contract, agreement, license or, commitment, which obligates the payment of more than $5,000,000 (individually or in the aggregate);

(iv) make any capital expenditures in excess of $5,000,000 (individually or in the aggregate);

(v) sell, lease, license or otherwise dispose of any of the Company’s or the Purchaser Parties’ assets or assets covered by any Contract except (i) pursuant to existing contracts or commitments disclosed herein, (ii) sales of inventory in the Ordinary Course consistent with past practice, and (iii) not exceeding $5,000,000;

(vi) accept returns of products sold from inventory except in the Ordinary Course, consistent with past practice;

(vii) pay, declare or promise to pay any dividends or other distributions with respect to its capital stock or share capital, or pay, declare or promise to pay any other payments to any stockholder or shareholder (other than, in the case of any stockholder or shareholder that is an employee, payments of salary accrued in said period at the current salary rate);

(viii) authorize any salary increase of more than 10% for any employee making an annual salary equal to or greater than $100,000 or in excess of $100,000 in the aggregate on an annual basis or change the bonus or profit sharing policies of the Company or the Purchaser Parties;

(ix) obtain or incur any loan or other Indebtedness in excess of $5,000,000, including drawings under the Company’s or the Purchaser Parties’ existing lines of credit;

(x) suffer or incur any Lien on the Company’s or the Purchaser Parties’ assets, except for Permitted Liens or the Liens incurred in the Ordinary Course of business consistent with past practice;

(xi) suffer any damage, destruction or loss of property related to any of the Company’s or the Purchaser Parties’ assets, whether or not covered by insurance, the aggregate value of which, following any available insurance reimbursement, exceed $5,000,000;

(xii) merge or consolidate with or acquire any other Person or be acquired by any other Person;

(xiii) suffer any insurance policy protecting any of the Company’s or the Purchaser Parties’ assets with an aggregate coverage amount in excess of $5,000,000 to lapse;

(xiv) make any change in its accounting principles other than in accordance with the applicable accounting policies or methods or write down the value of any inventory or assets other than in the Ordinary Course of business consistent with past practice;

(xvi) extend any loans other than travel or other expense advances to employees in the Ordinary Course of business or with the principal amount not exceeding $10,000;

(xvii) issue, redeem or repurchase any capital stock or share, membership interests or other securities, or issue any securities exchangeable for or convertible into any share or any shares of its capital stock;

(xviii) make or change any material Tax election or change any annual Tax accounting periods; or

(b) From the date hereof through the Closing Date, the Purchaser shall remain a “blank check company” as defined under the Securities Act, shall not conduct any business operations other than in connection with this Agreement and Ordinary Course operations to maintain its status as a Nasdaq-listed special purpose acquisition company pending the completion of the transactions contemplated hereby. Without limiting the generality of the foregoing, through the Closing Date, other than in connection with the transactions contemplated by this Agreement, without the Company’s prior written consent, the Purchaser Parties shall not amend, waive or otherwise change the Trust Agreement in any manner adverse to the Purchaser Parties.

(c) Neither party shall (i) take or agree to take any action that might make any representation or warranty of such party inaccurate or misleading in any material respect at, or as of any time prior to, the Closing Date or (ii) omit to take, or agree to omit to take, any action necessary to prevent any such representation or warranty from being inaccurate or misleading in any material respect at any such time.

Section 6.2 Alternative Proposal and Alternative Transaction. From the date hereof through the earlier of (x) termination of this Agreement in accordance with Article XI and (y) the Closing, other than in connection with the transactions contemplated hereby, neither the Company, on the one hand, nor the Purchaser Parties, on the other hand, shall, and such Persons shall cause each of their respective officers, directors, Affiliates, managers, consultants, employees, representatives (including investment bankers, attorneys and accountants) and agents not to, directly or indirectly, (i) encourage, solicit, initiate, engage or participate in negotiations with any Person concerning, or make any offers or proposals related to, any Alternative Transaction, (ii) take any other action intended or designed to facilitate the efforts of any Person relating to a possible Alternative Transaction, (iii) enter into, engage in or continue any discussions or negotiations with respect to an Alternative Transaction with, or provide any non-public information, data or access to employees to, any Person that has made, or that is considering making, a proposal with respect to an Alternative Transaction or (iv) approve, recommend or enter into any Alternative Transaction or any Contract related to any Alternative Transaction. For purposes of this Agreement, the term “Alternative Transaction” shall mean any of the following transactions involving the Company or the Purchaser Parties (other than the transactions contemplated by this Agreement and the other Transaction Documents): (1) any merger, consolidation, share exchange, business combination, amalgamation, recapitalization, consolidation, liquidation or dissolution or other similar transaction, or (2) any sale, lease, exchange, transfer or other disposition of a material portion of the assets of such Person (other than the sale, the lease, transfer or other disposition of assets in the Ordinary Course of business) or any class or series of the share capital or capital stock or other equity interests of the Company or the Purchaser Parties in a single transaction or series of transactions. In the event that there is an unsolicited proposal for, or an indication of a serious interest in entering into, an Alternative Transaction, communicated in writing to the Company or the Purchaser Parties or any of their respective representatives or agents (each, an “Alternative Proposal”), such party shall as promptly as practicable (and in any event within two (2) Business Days after receipt) advise the other parties to this Agreement in writing of such Alternative Proposal and the material terms and conditions of any such Alternative Proposal (including any changes thereto) and the identity of the person making any such Alternative Proposal. The Company on one hand and the Purchaser Parties one the other hand shall keep the other party informed on a reasonably current basis of material developments with respect to any such Alternative Proposal.

Section 6.3 Access to Information. From the date hereof until and including the Closing Date, each of the Company on one hand and the Purchaser Parties on the other hand shall, to the best of their abilities, (a) continue to give the other party, its legal counsel and other representatives full access to the offices, properties, and Books and Records, (b) furnish to the other party, its legal counsel and other representatives such information relating to the business of the Company or the Purchaser Parties as such Persons may request and (c) cause its respective employees, legal counsel, accountants and representatives to cooperate with the other party in such other party’s investigation of its business; provided that no investigation pursuant to this Section (or any investigation prior to the date hereof) shall affect any representation or warranty given by the Company or the Purchaser Parties and, provided further, that any investigation pursuant to this Section shall be conducted in such manner as not to interfere unreasonably with the conduct of the business of the Company or the Purchaser Parties. Notwithstanding anything to the contrary in this Agreement, no party shall be required to provide the access described above or disclose any information if doing so is reasonably likely to (i) result in a waiver of attorney client privilege, work product doctrine or similar privilege or (ii) violate any contract to which it is a party or to which it is subject or applicable Law, provided that the non-disclosing party must advise the other party that it is withholding such access and/or information and (to the extent reasonably practicable) and provide a description of the access not granted and/or information not disclosed.

Section 6.4 Notices of Certain Events. Each of the Company on one hand and the Purchaser Parties on the other hand shall promptly notify the other party of:

(a) any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the transactions contemplated by this Agreement or that the transactions contemplated by this Agreement might give rise to any Action by or on behalf of such Person or result in the creation of any Lien on any Company Share or share capital or capital stock of the Purchaser Parties or any of the Company’s or the Purchaser Parties’ assets;

(b) any notice or other communication from any Authority in connection with the transactions contemplated by this Agreement or the Transaction Documents;

(c) any Actions commenced or, to such party’s knowledge, threatened against, relating to or involving or otherwise affecting the consummation of the transactions contemplated by this Agreement or the Transaction Documents;

(d) with respect to the Company, the occurrence of any fact or circumstance which constitutes or results, or might reasonably be expected to constitute or result in a Company Material Adverse Effect; and with respect to the Purchaser Parties, the occurrence of any fact or circumstance which constitutes or results, or might reasonably be expected to constitute or result in a Purchaser Material Adverse Effect; and

(e) the occurrence of any fact or circumstance which results, or might reasonably be expected to result, in any representation made hereunder by such party to be false or misleading in any material respect or to omit or fail to state a material fact.

(i) As promptly as reasonably practicable after the execution of this Agreement, the Purchaser Parties shall prepare, and Purchaser shall file with the SEC, a registration statement on Form S-4 (as amended or supplemented from time to time, and including the Proxy Statement, the “Proxy/Registration Statement”) relating to (1) the Purchaser Shareholders’ Meeting to approve and adopt: (A) the Business Combination (as defined in Purchaser’s Organizational Documents), this Agreement and the other Transaction Documents, the Merger and the other Transactions, (the “Business Combination Proposal”), (B) the increase of the authorised share capital of the Purchaser from US$50,000 divided into 50,000,000 ordinary shares of US$0.001 par value per share to US$200,000 divided into 200,000,000 ordinary shares of US$0.001 par value per share (the “Share Capital Proposal”) (C) the change of name of the Purchaser to “MicroAlgo Inc.” (the “Change of Name Proposal”) (D) the amendment and restatement of the memorandum and articles of association of the Purchaser in accordance with Section 2.5(b) hereof (the “Organizational Documents Proposal”) (E) the appointment and/or removal of the directors of the Purchaser in accordance with Section 2.4 (the “Director Appointment Proposal”) and (F) adjournment of the Purchaser Shareholders’ Meeting, if necessary, to permit further solicitation of proxies because there are not sufficient votes to approve and adopt any of the foregoing (the “Adjournment Proposal”) (such proposals in (A), (B),(C), (D), (E) and (F) collectively, the “Transaction Proposals”), and (2) the registration under the Securities Act of the Consideration Shares to be issued to the Company Shareholders pursuant to this Agreement. The Purchaser Parties shall use their commercially reasonable efforts to (1) cause the Proxy/Registration Statement when filed with the SEC to comply in all material respects with all Laws applicable thereto and rules and regulations promulgated by the SEC, (2) respond as promptly as reasonably practicable to and resolve all comments received from the SEC concerning the Proxy/Registration Statement, (3) cause the Proxy/Registration Statement to be declared effective under the Securities Act as promptly as practicable and (4) keep the Proxy/Registration Statement effective as long as is necessary to consummate the Transactions. Prior to the effective date of the Proxy/Registration Statement, the Purchaser Parties shall take all or any action required under any applicable federal or state securities Laws in connection with the issuance of Purchaser Ordinary Shares pursuant to this Agreement. As promptly as practicable after finalization and effectiveness of the Proxy/Registration Statement, Purchaser shall use reasonable best efforts to within five Business Days thereof, mail the Proxy/Registration Statement to the Purchaser Shareholders.

(ii) Each of the Purchaser Parties and the Company shall furnish to the other parties all information concerning itself, its Subsidiaries, officers, directors, managers, shareholders, and other equityholders and information regarding such other matters as may be reasonably necessary or advisable or as may be reasonably requested in connection with the Proxy/Registration Statement, or any other statement, filing, notice or application made by or on behalf of the Purchaser Parties, the Company or their respective Affiliates to any regulatory Authority (including Nasdaq) in connection with the Transactions.

(iii) Any filing of, or amendment or supplement to, the Proxy/Registration Statement will be mutually agreed upon by the Purchaser Parties and the Company. The Purchaser Parties will advise the Company, promptly after receiving notice thereof, of the time when the Proxy/Registration Statement has become effective or any supplement or amendment has been filed, of the issuance of any stop order, of the suspension of the qualification of Purchaser Ordinary Shares to be issued or issuable in connection with this Agreement

for offering or sale in any jurisdiction, or of any request by the SEC for amendment of the Proxy/Registration Statement or comments thereon and responses thereto or requests by the SEC for additional information and responses thereto, and shall provide the Company a reasonable opportunity to provide comments and amendments to any such filing. The Purchaser Parties and the Company shall cooperate and mutually agree upon any response to comments of the SEC or its staff with respect to the Proxy/Registration Statement and any amendment to the Proxy/Registration Statement filed in response thereto.

(iv) If, at any time prior to the Effective Time, any information, event or circumstance relating to any Purchaser Party or their respective officers or directors, should be discovered by a Purchaser Party, which should be set forth in an amendment or a supplement to the Proxy/Registration Statement, so that neither of such documents would include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein, with respect to the Proxy Statement, in light of the circumstances under which they were made, not misleading, Purchaser shall promptly inform the Company. If, at any time prior to the Effective Time, any information, event or circumstance relating to the Company or its officers or directors, should be discovered by the Company, which should be set forth in an amendment or a supplement to the Proxy/Registration Statement, so that neither of such documents would include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein, with respect to the Proxy Statement, in light of the circumstances under which they were made, not misleading, the Company shall promptly inform the Purchaser. Thereafter, the Purchaser Parties and the Company shall promptly cooperate in the preparation and filing of an appropriate amendment or supplement to the Proxy/Registration Statement describing or correcting such information, and the Purchaser Parties shall promptly file such amendment or supplement with the SEC and, to the extent required by Law, disseminate such amendment or supplement to the Purchaser Shareholders.

(i) Prior to or as promptly as practicable after the Proxy/Registration Statement is declared effective under the Securities Act, Purchaser shall establish a depositary interest record date for, duly call, give notice of, convene and hold an extraordinary general meeting of the Purchaser Shareholders (including any adjournment or postponement thereof, the “Purchaser Shareholders’ Meeting”) to be held as promptly as reasonably practicable following the date that the Proxy/Registration Statement is declared effective under the Securities Act for the purpose of voting on the Transaction Proposals and obtaining the Purchaser Shareholders’ Approval (including any adjournment or postponement of such meeting for the purpose of soliciting additional proxies in favor of the adoption of this Agreement), providing Purchaser Shareholders with the opportunity to elect to effect a Purchaser Share Redemption and such other matter as may be mutually agreed by Purchaser and the Company. Purchaser will use its reasonable best efforts to (A) solicit from its shareholders proxies in favor of the adoption of the Transaction Proposals, including the Purchaser Shareholders’ Approval, and will take all other action necessary or advisable to obtain such proxies and Purchaser Shareholders’ Approval and (B) to obtain the vote or consent of its shareholders required by and in compliance with all applicable Law, Nasdaq rules and the Organizational Documents of Purchaser. Purchaser (X) shall consult with the Company regarding the depositary interest record date and the date of the Purchaser Shareholders’ Meeting and (Y) shall not adjourn or postpone the Purchaser Shareholders’ Meeting without the prior written consent of Company; provided, however, that Purchaser shall adjourn or postpone the Purchaser Shareholders’ Meeting (1) if, as of the time that the Purchaser Shareholders’ Meeting is originally scheduled, there are insufficient shares of Purchaser represented at such meeting (either in person or by proxy) to constitute a quorum necessary to conduct the business of the Purchaser Shareholders’ Meeting, or (2) if, as of the time that the Purchaser Shareholders’ Meeting is originally scheduled, adjournment or postponement of the Purchaser Shareholders’ Meeting is necessary to enable Purchaser to solicit additional proxies required to obtain Purchaser Shareholders’ Approval; provided further, however, that Purchaser shall adjourn or postpone on not more than three occasions and so long as the date of the Purchaser Shareholders’ Meeting is not adjourned or postponed more than an aggregate of 45 consecutive days in connection with such adjournment or postponement.

(ii) The Proxy/Registration Statement shall include a statement to the effect that the board of directors of the Purchaser Board has unanimously recommended that the Purchaser Shareholders vote in favor of the Transaction Proposals at the Purchaser Shareholders’ Meeting (such statement, the “Purchaser Board Recommendation”) and neither the Purchaser Board nor any committee thereof shall withhold, withdraw, qualify, amend or modify, or publicly propose or resolve to withhold, withdraw, qualify, amend or modify, the Purchaser Board Recommendation unless in strict observance of their common law or fiduciary duties.

Section 6.6 Support of Transactions. Without limiting any covenant contained in Article VI, Article VII and Article VIII, the Purchaser Parties and the Company and the Majority Shareholder shall each, and each shall cause its Subsidiaries to (a) use reasonable best efforts to obtain all material consents and approvals of third parties that any of the Purchaser Parties, or the Company or their respective Affiliates are required to obtain in order to consummate the Merger and the other Transactions, including cooperating, by adopting appropriate corporate resolutions and otherwise, to cause the name of the Purchaser to be changed immediately prior to the Closing to “MicroAlgo Inc.” and (b) take such other action as may be reasonably necessary or as another party hereto may reasonably request to satisfy the conditions of Article IX or otherwise to comply with this Agreement and to consummate the transactions contemplated hereby as soon as practicable. Notwithstanding anything to the contrary contained herein, no action taken by the Company under this Section 6.6 will constitute a breach of Section 6.1.

Section 6.7 Reasonable Best Efforts; Further Assurances. Subject to the terms and conditions of this Agreement, each party shall use its reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary or desirable under applicable Laws, and cooperate as reasonably requested by the other parties, to consummate and implement expeditiously each of the transactions contemplated by this Agreement and the Transaction Documents. The parties hereto shall execute and deliver such other documents, certificates, agreements, financial statements and other writings and take such other actions as may be necessary or reasonably desirable in order to consummate or implement expeditiously each of the transactions contemplated by this Agreement and the Transaction Documents.

Section 6.8 Confidentiality. Except as necessary to complete the Proxy/Registration Statement, the Company, on the one hand, and the Purchaser Parties, on the other hand, shall hold and shall cause their respective representatives to hold in strict confidence, unless compelled to disclose by judicial or administrative process or by other requirements of Law, all documents and information concerning the other party furnished to it by such other party or its representatives in connection with the transactions contemplated by this Agreement (except to the extent that such information can be shown to have been (a) previously known by the party to which it was furnished, (b) in the public domain through no fault of such party or (c) later lawfully acquired from other sources, which source is not the agent of the other party, by the party to which it was furnished), and each party shall not release or disclose such information to any other person, except its representatives in connection with this Agreement. In the event that any party believes that it is required to disclose any such confidential information pursuant to applicable Laws, such party shall give timely written notice to the other parties so that such parties may have an opportunity to obtain a protective order or other appropriate relief. Each party shall be deemed to have satisfied its obligations to hold confidential information concerning or supplied by the other parties if it exercises the same care as it takes to preserve confidentiality for its own similar information. The parties acknowledge that some previously confidential information will be required to be disclosed in the Proxy/Registration Statement.

Section 7.1 Reporting and Compliance with Laws. From the date hereof through the Closing Date, the Company shall duly and timely file all Tax Returns required to be filed with the applicable Taxing Authorities, pay any and all Taxes that are due and payable, as required by any Taxing Authority, and duly observe and conform in all material respects, to all applicable Laws and Orders.

Section 7.2 PCAOB Financials. By no later than August 15, 2021 the Company will deliver to the Purchaser Parties reviewed financial statements of the Company as of and for the six (6) month period ended June 30, 2021, all prepared in conformity with GAAP under the standards of the Public Company Accounting Oversight Board (the “PCAOB Financials”). The PCAOB Financials shall be (i) prepared from the Books and Records of the Company; (ii) prepared on an accrual basis in accordance with GAAP; (iii) contain and reflect all necessary adjustments and accruals for a fair presentation of the Company’s financial condition as of their dates including for all warranty, maintenance, service and indemnification obligations; and (iv) contain and reflect adequate provisions for all Liabilities for all material Taxes applicable to the Company with respect to the periods then ended. The PCAOBs will be complete and accurate and fairly present in all material respects, in conformity with GAAP applied on a consistent basis in all material respects, the financial position of the Company as of the dates thereof and the results

of operations of the Company for the periods reflected therein. The Company and the Majority Shareholder will provide additional financial information as reasonably requested by the Purchaser Parties for inclusion in any filings to be made by the Purchaser Parties with the SEC.

Section 7.3 No Claim Against the Trust Account. The Company acknowledges that it has read the IPO Prospectus and other Purchaser SEC Documents as filed under the Exchange Act, the Purchaser’s Organizational Documents, and the Trust Agreement and understands that Purchaser has established the Trust Account described therein for the benefit of Purchaser’s public shareholders and that disbursements from the Trust Account are available only in the limited circumstances set forth in the Trust Agreement. The Company further acknowledges that, if the Transactions, or, in the event of a termination of this Agreement, another Business Combination (as defined in the Purchaser’s Organizational Documents), are not consummated by February 11, 2022 or such later date as approved by the Purchaser Shareholders to complete a Business Combination (as defined in the Purchaser’s Organizational Documents), Purchaser will be obligated to return to its shareholders the amounts being held in the Trust Account. Accordingly, for and in consideration of Purchaser and Merger Sub entering into this Agreement, and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company hereby irrevocably waives any past, present or future Action of any kind against, and any right to access, the Trust Account or to collect from the Trust Account any monies that may be owed to them for any reason whatsoever, and will not seek recourse against the Trust Account at any time for any reason whatsoever save for the reasons set forth Section 13.6. Notwithstanding the foregoing, this Section 7.3 shall not serve to limit or prohibit the Company’s rights to pursue a claim against Purchaser for legal relief against assets held outside the Trust Account (including from and after the consummation of a Business Combination other than the one contemplated by this Agreement) or pursuant to Section 13.16 for specific performance or other injunctive relief. This Section 7.3 shall survive the termination of this Agreement for any and every reason.

Section 8.1 Nasdaq Listing. From the date hereof through the Effective Time, Purchaser shall ensure Purchaser remains listed as a public company on the Nasdaq, and shall prepare and submit to Nasdaq a listing application, if required under Nasdaq rules, covering the Consideration Shares issuable in the transactions contemplated hereby and shall obtain approval for the listing of such shares. After the date hereof and prior to the Effective Time, Purchaser shall procure the reservation of ticker symbol “MLGO” on Nasdaq.

Section 8.2 Public Filings. From the date hereof through the Closing, Purchaser shall keep current and timely file all reports required to be filed or furnished with the SEC and otherwise comply in all material respects with its reporting obligations under applicable Laws.

Section 8.3 Trust Account. Prior to or at the Closing (subject to the satisfaction or waiver of the conditions set forth in Article IX and provision of notice thereof to Trustee (which notice Purchaser shall provide to Trustee in accordance with the terms of the Trust Agreement)), Purchaser shall make appropriate arrangements to cause the funds in the Trust Account to be disbursed in accordance with the Trust Agreement, including causing the documents, opinions and notices required to be delivered to Trustee pursuant to the Trust Agreement to be so delivered, for the following: (a) the redemption of any Purchaser Ordinary Shares in connection with the Purchaser Share Redemption; (b) the payment of the amounts due to the underwriters and professional service providers of the IPO for their deferred underwriting commissions as set forth in the Trust Agreement; (c) the payment of the Transaction Expenses, and (d) the balance of the assets in the Trust Account, if any, after payment of the amounts required under the foregoing clauses (a) and (c), to be disbursed to Purchaser in accordance with the Trust Agreement, all of which shall subsequently be contributed to the Surviving Corporation for its working capital and general corporate purpose.

Section 8.4 Post-Closing Directors and Officers of Purchaser. Subject to the terms of the Purchaser’s Organizational Documents, Purchaser shall take all such action within its power as may be necessary or appropriate such that:

(a) immediately before the Closing, the Purchaser’s board of directors shall consist of five (5) directors:

(i) four (4) directors shall be designated by the Company, at least two of whom shall be considered “independent” for purposes of under Nasdaq rules requirement, and

(ii) one (1) director shall be designated by the Purchaser, who shall be “independent” for purposes of under Nasdaq rules requirement and shall be the “financial expert’ as determined under SEC rules and regulations and who shall be Ms. Shan Cui initially;

(b) from and after the Effective Time, the officers of Purchaser shall be the same as the officers of the Surviving Corporation (the “Purchaser Post-Closing Officers”), who shall serve in such capacity in accordance with the terms of Purchaser’s Organizational Documents following the Effective Time.

(a) From and after the Effective Time, Purchaser agrees that it shall indemnify and hold harmless each present and former director and officer of the (x) Company and each of its Subsidiaries (in each case, solely to the extent acting in their capacity as such and to the extent such activities are related to their business) and (y) Purchaser and each of its Subsidiaries (the Persons in the foregoing (x) and (y) are collectively referred to as, the “D&O Indemnified Parties”) against any costs or expenses (including reasonable attorneys’ fees), judgments, fines, losses, claims, damages or liabilities incurred in connection with any Action, whether civil, criminal, administrative or investigative, arising out of or pertaining to matters existing or occurring at or prior to the Effective Time, whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent that the Company, Purchaser or their respective Subsidiaries, as the case may be, would have been permitted under applicable Law and its respective certificate of incorporation, certificate of formation, bylaws, limited liability company agreement or other organizational documents in effect on the date of this Agreement to indemnify such D&O Indemnified Parties (including the advancing of expenses as incurred to the fullest extent permitted under applicable Law). Without limiting the foregoing, Purchaser shall, and shall cause its Subsidiaries to (i) maintain for a period of not less than six (6) years from the Effective Time provisions in its Organizational Documents concerning the indemnification and exoneration (including provisions relating to expense advancement) of Purchaser’s and its Subsidiaries’ former and current officers, directors, employees, and agents that are no less favorable to those Persons than the provisions of the Organizational Documents of the Company, Purchaser or their respective Subsidiaries, as applicable, in each case, as of the date of this Agreement, and (ii) not amend, repeal or otherwise modify such provisions in any respect that would adversely affect the rights of those Persons thereunder, in each case, except as required by Law. Purchaser shall assume, and be liable for, each of the covenants in this Section 8.5.

(b) For a period of six (6) years from the Effective Time, Purchaser shall maintain in effect directors’ and officers’ liability insurance covering those Persons who are currently covered by Purchaser’s, the Company’s or their respective Subsidiaries’ directors’ and officers’ liability insurance policies (true, correct and complete copies of which have been heretofore made available to Acquiror or its agents or representatives) on terms not less favorable than the terms of such current insurance coverage, except that in no event shall Purchaser be required to pay an annual premium for such insurance in excess of three hundred percent (300%) of the aggregate annual premium payable by Purchaser or the Company, as applicable, for such insurance policy for the year ended December 31, 2020; provided, however, that (i) Purchaser may cause coverage to be extended under the current directors’ and officers’ liability insurance by obtaining a six (6) year “tail” policy containing terms not materially less favorable than the terms of such current insurance coverage with respect to claims existing or occurring at or prior to the Effective Time and (ii) if any claim is asserted or made within such six (6) year period, any insurance required to be maintained under this Section 8.5 shall be continued in respect of such claim until the final disposition thereof.

(c) Notwithstanding anything contained in this Agreement to the contrary, this Section 8.5 shall survive the Closing indefinitely and shall be binding, jointly and severally, on Purchaser and all successors and assigns of Purchaser. In the event that Purchaser or any of its successors or assigns consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or merger or transfers or conveys all or substantially all of its properties and assets to any Person, then, and in each such case, Purchaser shall ensure that proper provision shall be made so that the successors and assigns of Purchaser shall succeed to the obligations set forth in this Section 8.5.

(d) On the Closing Date, Purchaser shall enter into customary indemnification agreements reasonably satisfactory to each of the Company and Purchaser with the post-Closing directors and officers of Purchaser, which indemnification agreements shall continue to be effective following the Closing.

Section 8.6 Backstop Investment. Unless otherwise approved in writing by the Company (which approval shall not be unreasonably withheld, conditioned or delayed), Purchaser shall not permit any amendment or modification to be made to, any waiver (in whole or in part) of, or provide consent to modify (including consent to terminate), any provision or remedy under, or any replacements of, any of the Backstop Agreements. Subject to the immediately preceding sentence, Purchaser shall use its reasonable best efforts to take, or to cause to be taken, all actions required, necessary or that it otherwise deems to be proper or advisable to consummate the transactions contemplated by the Backstop Agreements on the terms described therein, including using its reasonable best efforts to enforce its rights under the Backstop Agreements to cause the Backstop Investors to pay to (or as directed by) Purchaser the applicable purchase price under each Backstop Investor’s applicable Backstop Agreement in accordance with its terms.

Section 8.7 Section 16 Matters. Prior to the Closing, the board of directors of Purchaser, or an appropriate committee of “non-employee directors” (as defined in Rule 16b-3 of the Exchange Act) thereof, shall adopt a resolution consistent with the interpretive guidance of the SEC so that the acquisition of Purchaser Ordinary Shares pursuant to this Agreement and the other agreements contemplated hereunder, by any Person owning securities of the Company who is expected to become a director or officer (as defined under Rule 16a-1(f) under the Exchange Act) of Purchaser following the Closing shall be exempt transaction for purposes of Section 16(b) of the Exchange Act pursuant to Rule 16b-3 thereunder.

Section 8.8 Shareholder Litigation. In the event that any litigation related to this Agreement, any Transaction Document or the transactions contemplated hereby or thereby is brought, or, to the knowledge of Purchaser Parties, threatened in writing, against Purchaser or the board of directors of Purchaser by any of Purchaser’s shareholders prior to the Closing, Purchaser shall promptly notify the Company of any such litigation and keep the Company reasonably informed with respect to the status thereof. Purchaser shall provide the Company the opportunity to participate in (subject to a customary joint defense agreement), the defense of any such litigation, shall give due consideration to the Company’s advice with respect to such litigation and shall not settle or agree to settle any such litigation without the prior written consent of the Company, such consent not to be unreasonably withheld, conditioned or delayed.

Section 8.9 Final Allocation Statement. The Purchaser Parties shall deliver to the Company at least two Business Days prior to the Closing the final version of the Allocation Statement, setting forth the number of Consideration Shares issuable to each Company Shareholders, comprising the Closing Payment Shares and with respect to the Majority Shareholder, the Escrow Shares; such Allocation Statement shall not be subject to further updates.

Section 9.1 Condition to the Obligations of the Parties. The obligations of all of the parties hereto to consummate the Closing are subject to the satisfaction of all the following conditions:

(a) No provisions of any applicable Law, and no Order shall prohibit or prevent the consummation of the Closing.

(b) There shall not be any Action brought by a third party that is not an Affiliate of the parties hereto to enjoin or otherwise restrict the consummation of the Closing.

(c) The SEC shall have declared the Proxy/Registration Statement effective. No stop order suspending the effectiveness of the Proxy/Registration Statement or any part thereof shall have been issued.

(e) Purchaser shall have at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) immediately after the Closing.

Section 9.2 Conditions to Obligations of the Purchaser Parties. The obligation of the Purchaser Parties to consummate the Closing is subject to the satisfaction, or the waiver at the Purchaser Parties’ sole and absolute discretion, of all the following further conditions:

(a) The Company shall have duly performed all of its obligations hereunder required to be performed by it at or prior to the Closing Date in all material respects, unless the applicable obligation has a materiality qualifier in which case it shall be duly performed in all respects.

(b) All of the representations and warranties of the Company contained in Article IV in this Agreement, disregarding all qualifications and exceptions contained herein relating to materiality or Company Material Adverse Effect, regardless of whether it involved a known risk, shall: (i) be true and correct at and as of the date of this Agreement, and (ii) be true and correct as of the Closing Date (except for the representation and warranties that speak as of a specific date prior to the Closing Date, in which case such representations and warranties need only to be true and correct as of such earlier date), in the case of (i) and (ii), other than as would not in the aggregate reasonably be expected to have a Company Material Adverse Effect.

(d) The Purchaser Parties shall have received a certificate signed by the chief executive officer of the Company to the effect set forth in clauses (a) through (c) of this Section 9.2.

Section 9.3 Conditions to Obligations of the Company. The obligations of the Company to consummate the Closing is subject to the satisfaction, or the waiver at the Company’s discretion, of all of the following further conditions:

(a) The Purchaser Parties shall have duly performed all of their obligations hereunder required to be performed by them at or prior to the Closing Date in all material respects, unless the applicable obligation has a materiality qualifier in which case it shall be duly performed in all respects.

(b) All of the representations and warranties of the Purchaser Parties contained in Article V of this Agreement, disregarding all qualifications and exceptions contained herein relating to materiality or Purchaser Material Adverse Effect, regardless of whether it involved a known risk, shall: (i) be true and correct at and as of the date of this Agreement and (ii) be true and correct as of the Closing Date (except for representation and warranties that speak as of a specific date prior to the Closing Date, in which case such representations and warranties need only to be true and correct as of such earlier date), in the case of (i) and (ii), other than as would not in the aggregate reasonably be expected to have a Purchaser Material Adverse Effect.

(d) From the date hereof until the Closing, the Purchaser Parties shall have been in material compliance with the reporting requirements under the Securities Act and the Exchange Act applicable to the Purchaser Parties.

(e) Purchaser Ordinary Shares shall remain listed for trading on Nasdaq and the additional listing application for the Consideration Shares shall have been approved by Nasdaq. As of the Closing Date, Purchaser shall not have received any written notice from Nasdaq that it has failed, or would reasonably be expected to fail to meet the Nasdaq listing requirements as of the Closing Date for any reason, where such notice has not been subsequently withdrawn by Nasdaq or the underlying failure appropriately remedied or satisfied.

(f) The Persons identified in Section 8.4(a) shall have been elected to the board of directors of the Purchaser immediately before the Closing.

(g) The Purchaser’s name shall have been changed to “MicroAlgo Inc.” immediately before the Closing.

(h) The Company shall have received a certificate signed by the chief executive officer of the Purchaser to the effect set forth in clauses (a) through (g) of this Section 9.3.

(a) The parties shall promptly submit any dispute, claim, or controversy arising out of or relating to this Agreement (including with respect to the meaning, effect, validity, termination, interpretation, performance, or enforcement of this Agreement) or any alleged breach thereof (including any action in tort, contract, equity, or otherwise), to binding arbitration before one arbitrator (the “Arbitrator”). Binding arbitration shall be the sole means of resolving any dispute, claim, or controversy arising out of or relating to this Agreement (including with respect to the meaning, effect, validity, termination, interpretation, performance or enforcement of this Agreement) or any alleged breach thereof (including any claim in tort, contract, equity, or otherwise).

(b) If the parties cannot agree upon the Arbitrator, the Arbitrator shall be selected by the New York, New York chapter head of the American Arbitration Association upon the written request of either side. The Arbitrator shall be selected within thirty (30) days of such written request.

(c) The laws of the State of New York shall apply to any arbitration hereunder. In any arbitration hereunder, this Agreement shall be governed by the laws of the State of New York applicable to a contract negotiated, signed, and wholly to be performed in the State of New York, which laws the Arbitrator shall apply in rendering his decision. The Arbitrator shall issue a written decision, setting forth findings of fact and conclusions of law, within sixty (60) days after he shall have been selected. The Arbitrator shall have no authority to award punitive or other exemplary damages.

(d) The arbitration shall be held in New York, New York in accordance with and under the then-current provisions of the rules of the American Arbitration Association, except as otherwise provided herein.

(e) On application to the Arbitrator, any party shall have rights to discovery to the same extent as would be provided under the Federal Rules of Civil Procedure, and the Federal Rules of Evidence shall apply to any arbitration under this Agreement; provided, however, that the Arbitrator shall limit any discovery or evidence such that his decision shall be rendered within the period referred to in Section 10.1(c).

(f) The Arbitrator may, at his discretion and at the expense of the party who will bear the cost of the arbitration, employ experts to assist him in his determinations.

(g) The costs of the arbitration proceeding and any proceeding in court to confirm any arbitration award (including actual attorneys’ fees and costs), shall be borne by the unsuccessful party and shall be awarded as part of the Arbitrator’s decision, unless the Arbitrator shall otherwise allocate such costs in such decision. The determination of the Arbitrator shall be final and binding upon the parties and not subject to appeal.

(h) Any judgment upon any award rendered by the Arbitrator may be entered in and enforced by any court of competent jurisdiction. The parties expressly consent to the non-exclusive jurisdiction of the courts (Federal and state) in New York, New York to enforce any award of the Arbitrator or to render any provisional, temporary, or injunctive relief in connection with or in aid of the arbitration. The parties expressly consent to the personal and subject matter jurisdiction of the Arbitrator to arbitrate any and all matters to be submitted to arbitration hereunder. None of the parties hereto shall challenge any arbitration hereunder on the grounds that any party necessary to such arbitration (including the parties hereto) shall have been absent from such arbitration for any reason, including that such party shall have been the subject of any bankruptcy, reorganization, or insolvency proceeding.

(i) The parties shall indemnify the Arbitrator and any experts employed by the Arbitrator and hold them harmless from and against any claim or demand arising out of any arbitration under this Agreement, unless resulting from the gross negligence or willful misconduct of the person indemnified.

(a) THE PARTIES TO THIS AGREEMENT HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVE ANY RIGHT EACH SUCH PARTY MAY HAVE TO TRIAL BY JURY IN ANY ACTION OF ANY KIND OR NATURE, IN ANY COURT IN WHICH AN ACTION MAY BE COMMENCED,

ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION DOCUMENTS, OR BY REASON OF ANY OTHER CAUSE OR DISPUTE WHATSOEVER BETWEEN OR AMONG ANY OF THE PARTIES TO THIS AGREEMENT OF ANY KIND OR NATURE. NO PARTY SHALL BE AWARDED PUNITIVE OR OTHER EXEMPLARY DAMAGES RESPECTING ANY DISPUTE ARISING UNDER THIS AGREEMENT OR ANY TRANSACTION DOCUMENTS.

(b) Each of the parties to this Agreement acknowledges that each has been represented in connection with the signing of this waiver by independent legal counsel selected by the respective party and that such party has discussed the legal consequences and import of this waiver with legal counsel. Each of the parties to this Agreement further acknowledges that each has read and understands the meaning of this waiver and grants this waiver knowingly, voluntarily, without duress and only after consideration of the consequences of this waiver with legal counsel.

Section 11.1 Termination without Default In the event that the Closing of the transactions contemplated hereunder has not occurred by September 30, 2021 (the “Outside Closing Date”) and no material breach of this Agreement by the party seeking to terminate this Agreement shall have occurred or have been made (as provided in Section 11.2 hereof), the Purchaser Parties or the Company, as the case may be, shall have the right, at its sole option, to terminate this Agreement without liability to the other side. Such right may be exercised by Purchaser Parties or the Company, as the case may be, by giving written notice to the other at any time after the Outside Closing Date.

(a) The Purchaser Parties may terminate this Agreement by giving notice to the Company, without prejudice to any rights or obligations the Purchaser Parties may have, if the Company shall have materially breached any of its covenants, agreements, representations, and warranties contained herein or in any Transaction Documents to be performed on or prior to the Closing Date and such breach shall not be cured within fifteen (15) days following receipt by the Company of a notice describing in reasonable detail the nature of such breach.

(b) The Company may terminate this Agreement by giving notice to any Purchaser Party, without prejudice to any rights or obligations the Company may have, if any Purchaser Party shall have materially breached any of its covenants, agreements, representations, and warranties contained herein or in any Transaction Documents to be performed on or prior to the Closing Date and such breach shall not be cured within fifteen (15) days following receipt by such Purchaser Party of a notice describing in reasonable detail the nature of such breach.

Section 11.3 Effect of Termination. In the event that this Agreement is terminated pursuant to Section 11.2 hereof, this Agreement shall forthwith become void, and there shall be no liability under this Agreement on the part of any party hereto, except (i) as set forth in Article X, this Section 11.2, and Article XII.

Section 12.1 Indemnification of Purchaser. Subject to the terms and conditions of this Article XII and from and after the Closing Date, the Majority Shareholder (the “Indemnifying Party”)agrees to indemnify and hold harmless the Purchaser (the “Indemnified Party”), against and in respect of any and all out-of-pocket loss, cost, payment, demand, penalty, forfeiture, expense, liability, judgment, deficiency or damage, and diminution in value or claim (including actual costs of investigation and attorneys’ fees and other costs and expenses) (all of the foregoing collectively, “Losses”) incurred or sustained by the Indemnified Party as a result of or in connection with any breach or inaccuracy of any of the representations or warranties of the Company contained in Article IV herein. Notwithstanding the foregoing, the Indemnified Party shall not assert any claim, and shall not be entitled to indemnification, unless and until the aggregate amount of all Losses indemnifiable hereunder exceeds $1,000,000 (the “Threshold”), in which event the Indemnifying Party shall be responsible for the aggregate amount of Losses from the first dollar, and any liability incurred pursuant to the terms of this Article XII shall be paid exclusively from the Escrow Shares valued at the then market value per share and in accordance with the terms of the Escrow Agreement. For purposes of this Article XII, “then market value” of the Escrow Shares shall mean (i) in the event

that Purchaser has made public disclosure of the facts or circumstances or Third-Party Claims which may provide the basis for indemnification for Losses under this Article XII, the average closing price of the Purchaser Ordinary Shares on the principal trading market or exchange for the 10 trading days following the initial trading day after any such disclosure or (ii) in the event that Purchaser has not made public disclosure of any facts or circumstances or Third-Party Claims which may provide the basis for indemnification for Losses under this Article XII, then $10.00 per Purchaser Ordinary Share

Section 12.2 Procedure. The following shall apply with respect to all claims by the Indemnified Party for indemnification:

(a) The Indemnified Party shall give the Indemnifying Party prompt notice (an “Indemnification Notice”) of any third-party action with respect to which the Indemnified Party seeks indemnification pursuant to Section 12.1 (a “Third-Party Claim”), which shall describe in reasonable detail the Loss that has been or may be suffered by the Indemnified Party. The failure to give the Indemnification Notice shall not impair any of the rights or benefits of the Indemnified Party under Section 12.1, except to the extent such failure adversely affects the ability of the Indemnifying Party to defend such claim or increases the amount of such liability;

(b) In the case of any Third-Party Claims as to which indemnification is sought by the Indemnified Party, the Indemnified Party shall be entitled to exercise full control of the defense, compromise or settlement of any Third-Party Claim unless the Indemnifying Party, within a reasonable time after the giving of an Indemnification Notice by the Indemnified Party (but in any event within thirty (30) days thereafter), shall (i) deliver a written confirmation to the Indemnified Party that the indemnification provisions of Section 12.1 are applicable to such action and the Indemnifying Party will indemnify the Indemnified Party in respect of such action pursuant to the terms of Section 12.1, (ii) notify such Indemnified Party in writing of the intention of the Indemnifying Party to assume the defense thereof, and (iii) retain legal counsel reasonably satisfactory to the Indemnified Party to conduct the defense of such Third-Party Claim;

(c) If the Indemnifying Party assumes the defense of any such Third-Party Claim pursuant to Section 12.2(b), then the Indemnified Party shall cooperate with the Indemnifying Party in any manner reasonably requested in connection with the defense. If the Indemnifying Party so assumes the defense of any such Third-Party Claim, the Indemnified Party shall have the right to employ separate counsel and to participate in (but not control) the defense, compromise, or settlement thereof, and the fees and expenses of such counsel employed by the Indemnified Party shall be at the expense of the Indemnified Party unless (i) the Indemnifying Party has agreed to pay such fees and expenses, or (ii) the named parties to any such Third-Party Claim (including any impleaded parties) include the Indemnified Party and the Indemnifying Party and the Indemnified Party shall have been advised by its counsel that there may be a conflict of interest between the Indemnified Party and the Indemnifying Party in the conduct of the defense thereof, and in any such case the reasonable fees and expenses of such separate counsel shall be borne by the Indemnifying Party;

(d) If the Indemnifying Party elects to assume the defense of any Third-Party Claim pursuant to Section 12.2(b), the Indemnified Party shall not pay, or permit to be paid, any part of any claim or demand arising from such asserted liability unless the Indemnifying Party withdraws from or fail to adequately prosecute the defense of such asserted liability, or unless a judgment is entered against the Indemnified Party for such liability. If the Indemnifying Party does not elect to defend, or if, after commencing or undertaking any such defense, the Indemnifying Party fails to adequately prosecute or withdraw such defense, the Indemnified Party shall have the right to undertake the defense or settlement thereof, at the Indemnifying Party’s expense. Notwithstanding anything to the contrary, the Indemnifying Party shall not be entitled to control over, but may participate in, and the Indemnified Party shall be entitled to have sole control over, the defense or settlement of (x) that part of any Third-Party Claim (i) that seeks a temporary restraining order, a preliminary or permanent injunction or specific performance against the Indemnified Party, or (ii) to the extent such Third-Party Claim involves criminal allegations against the Indemnified Party or (y) the entire Third-Party Claim if such Third-Party Claim would impose liability on the part of the Indemnified Party in an amount which is greater than the amount as to which the Indemnified Party is entitled to indemnification under this Agreement. In the event the Indemnified Party retains control of the Third-Party Claim, the Indemnified Party will not settle the subject claim without the prior written consent of the Indemnifying Party;

(e) If the Indemnified Party undertakes the defense of any such Third-Party Claim pursuant to Section 12.2(b) and proposes to settle the same prior to a final judgment thereon or to forgo appeal with respect thereto, then the Indemnified Party shall give the Indemnifying Party prompt written notice thereof and the Indemnifying Party shall have the right to participate in the settlement, assume or reassume the defense thereof or prosecute such appeal, in each case at the Indemnifying Party’s expense. The Indemnifying Party shall not, without the prior written consent of the Indemnified Party settle or compromise or consent to entry of any judgment with respect to any such Third-Party Claim (i) in which any relief other than the payment of money damages is or may be sought against the Indemnified Party, (ii) in which such Third-Party Claim could be reasonably expected to impose or create a monetary liability on the part of the Indemnified Party (such as an increase in the Indemnified Party’s income Tax) other than the monetary claim of the third party in such Third-Party Claim being paid pursuant to such settlement or judgment, or (iii) which does not include as an unconditional term thereof the giving by the claimant, person conducting such investigation or initiating such hearing, plaintiff or petitioner to the Indemnified Party of a release from all liability with respect to such Third-Party Claim and all other actions (known or unknown) arising or which might arise out of the same facts;

(f) Following the Closing, the disinterested independent directors of the Purchaser shall have the authority to institute and prosecute any claims for indemnification hereunder in good faith on behalf of the Purchaser to enforce the terms of this Agreement.

Section 12.3 Escrow Shares; Payment of Dividends; Voting. Any dividends, interest payments, or other distributions of any kind made in respect of the Escrow Shares will be delivered promptly to the Escrow Agent to be held in escrow. The Majority Shareholder shall be entitled to vote the Escrow Shares on any matters to come before the Purchaser Shareholders.

(a) Distribution of Escrow Shares. At the times provided for in Section 12.3(b), the Escrow Shares shall be released and transferred by the Escrow Agent to the Majority Shareholder. The Purchaser will take such action as may be necessary to cause such securities to be issued in the names of the appropriate Persons;

(b) Release from Escrow. Within five (5) Business Days following expiration of the Survival Period (the “Release Date”), the Escrow Shares will be released from escrow to the Majority Shareholder, less the number of Escrow Shares, the amount of which, valued at the then market value per share, is equal to the amount of any potential Losses set forth in any Indemnification Notice from the Purchaser with respect to any pending but unresolved claim for indemnification. Prior to the Release Date, the Majority Shareholder shall issue to the Escrow Agent a certificate executed by the Majority Shareholder instructing the Escrow Agent to release such number of Escrow Shares determined in accordance with this Section 12.3(b). Any Escrow Shares retained in escrow as a result of the immediately preceding sentence shall be released and transferred to the Majority Shareholder promptly upon resolution of the related claim for indemnification in accordance with the provisions of this Article XII. Notwithstanding anything to the contrary contained herein, any indemnification payments will be made to Purchaser or its successors. Any Escrow Shares received by Purchaser as an indemnification payment shall be promptly cancelled by Purchaser after its receipt thereof.

Section 12.4 Payment of Indemnification. In the event that the Purchaser is entitled to any indemnification pursuant to this Article XII, the Purchaser shall be paid exclusively from the Escrow Shares. Any indemnification payments hereunder shall take into account any insurance proceeds or other third party reimbursement that the Indemnified Party is entitled to.

Section 12.5 Survival of Indemnification Rights. All representations and warranties contained in this Agreement (including all schedules and exhibits hereto and all certificates, documents, instruments and undertakings furnished pursuant to this Agreement) shall survive until 12 months following the Closing Date (the “Survival Period”); provided that the representations and warranties on Taxes in Section 4.20 shall survive until the expiry of the applicable statute of limitations. After the expiration of the Survival Period, the Indemnifying Party shall have no further liability for indemnification pursuant to this Article XII other than with respect to the claims already made pursuant to this Article XII.

Section 12.6 Sole and Exclusive Remedy. The remedies provided in this Article XII shall be deemed the sole and exclusive remedies of the Indemnified Party, from and after the Closing Date, with respect to any and all claims arising out of or related to this Agreement or in connection with the transactions contemplated hereby.

Section 13.1 Notices. Any notice hereunder shall be sent in writing, addressed as specified below, and shall be deemed given: (a) if by hand or recognized courier service, by 4:00PM on a business day, addressee’s day and time, on the date of delivery, and otherwise on the first business day after such delivery; (b) if by fax or email, on the date that transmission is confirmed electronically, if by 4:00PM on a business day, addressee’s day and time, and otherwise on the first business day after the date of such confirmation; or (c) five days after mailing by certified or registered mail, return receipt requested. Notices shall be addressed to the respective parties as follows (excluding telephone numbers, which are for convenience only), or to such other address as a party shall specify to the others in accordance with these notice provisions:

20^thFloor, South Tower, Beijing Kerry Center, 1 Guang Hua Road, Chaoyang District, Beijing 100020

Becker & Poliakoff LLP
45 Broadway, 17^th Floor,New York, NY 10006
Attn: Bill Huo/Brian C. Daughney
Email: BHuo@beckerlawyers.com; BDaughney@beckerlawyers.com

Section 13.2 Non-survival or Representations, Warranties and Covenants. None of the representations, warranties, covenants, obligations or other agreements in this Agreement or in any certificate, statement or instrument delivered pursuant to this Agreement, including any rights arising out of any breach of such representations, warranties, covenants, obligations, agreements and other provisions, shall survive the Closing, and all such representations, warranties, covenants, obligations or other agreements shall terminate and expire upon the occurrence of the Closing (and there shall be no liability after the Closing in respect thereof), except for (a) those covenants and agreements contained herein that by their terms expressly apply in whole or in part after the Closing and then only with respect to any breaches occurring after the Closing, (b) the indemnification of Purchaser set forth in Article XII, and (c) this Article XII and any corresponding definitions set forth in Article I.

(a) This Agreement cannot be amended, except by a writing signed by each of the Purchaser Parties and the Company, and cannot be terminated orally or by course of conduct. No provision hereof can be waived, except by a writing signed by the party against whom such waiver is to be enforced, and any such waiver shall apply only in the particular instance in which such waiver shall have been given.

(b) Neither any failure or delay in exercising any right or remedy hereunder or in requiring satisfaction of any condition herein nor any course of dealing shall constitute a waiver of or prevent any party from enforcing any right or remedy or from requiring satisfaction of any condition. No notice to or demand on a party waives or otherwise affects any obligation of that party or impairs any right of the party giving such notice or making such demand, including any right to take any action without notice or demand not otherwise required by this Agreement. No exercise of any right or remedy with respect to a breach of this Agreement shall preclude exercise of any other right or remedy, as appropriate to make the aggrieved party whole with respect to such breach, or subsequent exercise of any right or remedy with respect to any other breach.

(c) Except as otherwise expressly provided herein, no statement herein of any right or remedy shall impair any other right or remedy stated herein or that otherwise may be available.

(d) Notwithstanding anything else contained herein, neither shall any party seek, nor shall any party be liable for, punitive or exemplary damages, under any tort, contract, equity, or other legal theory, with respect to any breach (or alleged breach) of this Agreement or any provision hereof or any matter otherwise relating hereto or arising in connection herewith.

Section 13.4 Arm’s Length Bargaining; No Presumption Against Drafter. This Agreement has been negotiated at arm’s-length by parties of equal bargaining strength, each represented by counsel or having had but declined the opportunity to be represented by counsel and having participated in the drafting of this Agreement. This Agreement creates no fiduciary or other special relationship between the parties, and no such relationship otherwise exists. No presumption in favor of or against any party in the construction or interpretation of this Agreement or any provision hereof shall be made based upon which Person might have drafted this Agreement or such provision.

(a) All press releases or other public communications relating to the Transactions, and the method of the release for publication thereof, shall prior to the Acquisition Closing be subject to the prior mutual approval of Purchaser and the Company; provided, that no such party shall be required to obtain consent pursuant to this Section 12.5(a) to the extent any proposed release or statement is substantially equivalent to the information that has previously been made public without breach of the obligation under this Section 12.5(a).

(b) The restriction in Section 12.5(a) shall not apply to the extent the public announcement is required by applicable securities Law, any Governmental Authority or stock exchange rule; provided, however, that in such an event, the party making the announcement shall, to the extent practicable, use its commercially reasonable efforts to consult with the other party in advance as to its form, content and timing

Section 13.6 Expenses. Except as otherwise set forth in this Agreement, each party shall bear its own costs and expenses in connection with this Agreement and the transactions contemplated hereby; provided that, if the Closing shall occur, Purchaser shall pay or cause to be paid the unpaid Company Transaction Expenses by wire transfer of immediately available funds to the designated account. For the avoidance of doubt, any payments to be made (or to cause to be made) by Purchaser pursuant to this Section 12.6 shall promptly and immediately be paid upon consummation of the Closing and release of proceeds from the Trust Account.

Section 13.7 No Assignment or Delegation. No party may assign any right or delegate any obligation hereunder, including by merger, consolidation, operation of law, or otherwise, without the written consent of the other party. Any purported assignment or delegation without such consent shall be void, in addition to constituting a material breach of this Agreement.

Section 13.8 Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, without giving effect to the conflict of laws principles thereof.

Section 13.9 Counterparts; Facsimile Signatures. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart or the earlier delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but need not individually) bear the signatures of all other parties.

Section 13.10 Entire Agreement. This Agreement together with the other Transaction Documents, including any exhibits and schedules attached hereto or thereto, sets forth the entire agreement of the parties with respect to the subject matter hereof and thereof and supersedes all prior and contemporaneous understandings and agreements related thereto (whether written or oral), all of which are merged herein. No provision of this Agreement or any Transaction Documents, including any exhibits and schedules attached hereto or thereto, may be explained or qualified by any agreement, negotiations, understanding, discussion, conduct or course of conduct or by any trade usage. Except as otherwise expressly stated herein or any Transaction Documents, there is no condition precedent to the effectiveness of any provision hereof or thereof. No party has relied on any representation from, or warranty or agreement of, any person in entering into this Agreement, prior hereto or contemporaneous herewith or any Transaction Documents, except those expressly stated herein or therein.

Section 13.11 Severability. A determination by a court or other legal authority that any provision that is not of the essence of this Agreement is legally invalid shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good faith to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision, as alike in substance to such invalid provision as is lawful.

Section 13.12 Construction of Certain Terms and References; Captions. In this Agreement:

(a) References to particular sections and subsections, schedules, and exhibits not otherwise specified are cross-references to sections and subsections, schedules, and exhibits of this Agreement.

(b) All monetary figures used herein shall be in United States dollars unless otherwise specified.

(c) The words “herein,” “hereof,” “hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular provision of this Agreement, and, unless the context requires otherwise, “party” means a party signatory hereto.

(d) The phrase “directly or indirectly” means directly, or indirectly through one or more intermediate persons or through contractual or other legal arrangements, and “direct or indirect” has the correlative meaning

(e) Any use of the singular or plural, or the masculine, feminine, or neuter gender, includes the others, unless the context otherwise requires; “including” means “including without limitation;” “or” means “and/or;” “any” means “any one, more than one, or all”.

(f) Unless otherwise specified, any reference to any agreement (including this Agreement), instrument, or other document includes all schedules, exhibits, or other attachments referred to therein, and any reference to a statute or other law includes any rule, regulation, ordinance, or the like promulgated thereunder, in each case, as amended, restated, supplemented, or otherwise modified from time to time. Any reference to a numbered schedule means the same-numbered section of the disclosure schedule.

(g) If any action is required to be taken or notice is required to be given within a specified number of days following a specific date or event, the day of such date or event is not counted in determining the last day for such action or notice. If any action is required to be taken or notice is required to be given on or before a particular day which is not a Business Day, such action or notice shall be considered timely if it is taken or given on or before the next Business Day.

(h) Captions/headings are not a part of this Agreement, but are included for convenience, only.

(i) A reference to a statute or statutory provision includes, to the extent applicable at any relevant time:

(i) that statute or statutory provision as from time to time consolidated, modified, re-enacted or replaced by any other statute or statutory provision;

(ii) any repealed statute or statutory provision which it re-enacts (with or without modification); and

(iii) any subordinate legislation or regulation made under the relevant statute or statutory provision.

Section 13.13 Further Assurances. Each party shall execute and deliver such documents and take such action, as may reasonably be considered within the scope of such party’s obligations hereunder, necessary to effectuate the transactions contemplated by this Agreement.

Section 13.14 Third Party Beneficiaries. Neither this Agreement nor any provision hereof confers any benefit or right upon or may be enforced by any Person not a signatory hereto.

(a) Recognizing that DLA Piper (“DLA”) acted as legal counsel to the Company and certain of their respective affiliates prior to the Closing, and that DLA may act as legal counsel to the Surviving Corporation and one or more of its Subsidiaries after the Closing, each of the Company and the Surviving Corporation (including on behalf of the Surviving Corporation’s Subsidiaries) hereby waives, on its own behalf and agrees to cause its Affiliates to waive, any conflicts that may arise in connection with DLA representing any of the Company, the Surviving Corporation or any of its Subsidiaries and any of their respective affiliates after the Closing.

(b) Recognizing that Becker & Poliakoff LLP (“Becker”) acted as legal counsel to the Purchaser and certain of their respective affiliates prior to the Closing, and that Becker may act as legal counsel to the Purchaser and one or more of its Subsidiaries after the Closing, the Purchaser hereby waives, on its own behalf and agrees to cause its Affiliates to waive, any conflicts that may arise in connection with Becker representing the Purchaser and any of its Affiliates after the Closing.

(a) The Parties hereby agree that irreparable damage for which monetary damages, even if available, would not be an adequate remedy, would occur in the event that any provision of this Agreement (including failing to take such actions as are required of it hereunder to consummate the Merger or the other Transactions) is not performed in accordance with its specific terms or is otherwise breached. Accordingly, the Parties agree that each Party shall be entitled to an injunction or injunctions, or any other appropriate form of specific performance or equitable relief, to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any court of competent jurisdiction in accordance with this Agreement this being in addition to any other remedy to which they are entitled under the terms of this Agreement at Law or in equity (and each Party hereby waives any requirement for the securing or posting of any bond in connection with such remedy);

(b) Each of the Parties agrees that it will not oppose the granting of an injunction, specific performance and other equitable relief when expressly available pursuant to the terms of this Agreement on the basis that the other Parties have an adequate remedy at Law or an award of specific performance is not an appropriate remedy for any reason at Law or equity. Any Party seeking an injunction or injunctions to prevent breaches or threatened breaches of, or to enforce compliance with this Agreement when expressly available pursuant to the terms of this Agreement shall not be required to provide any bond or other security in connection with any such order or injunction.

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IN WITNESS WHEREOF, each of the parties have hereunto caused this Agreement to be duly executed as of the date first above written.

This AMENDMENT NO. 1 TO MERGER AGREEMENT (the “Agreement”), dated as of January __, 2022 (the “Signing Date”), by and among VIYI Algorithm Inc., a Cayman Islands exempted company (the “Company”), Venus Acquisition Corporation, a Cayman Islands exempted company (the “Purchaser”), Venus Merger Sub Corp., a Cayman Islands exempted company and wholly-owned subsidiary of the Purchaser (the “Merger Sub”) and WiMi Hologram Cloud Inc., a Cayman Islands company and the legal and beneficial owner of a majority of the issued and outstanding voting securities of the Company (“Majority Shareholder”). The Company, Purchaser, Merger Sub and Majority Shareholder are sometimes collectively referred to as the “Parties” and individually as a “Party”.

WHEREAS, the Parties have previously entered into that certain Merger Agreement dated as of June 10, 2021 (“Original Agreement”) whereby, among other things, VIYI will merge with Venus Merger Sub and VIYI will survive the merger as a wholly-owned subsidiary of Venus and continue its business operations (the “Merger”); and

WHEREAS, Venus has filed a combination Registration Statement and Proxy Statement on Form S-4 (SEC File No.: 333-257518) (“Registration Statement”) with the Securities and Exchange Commission (“SEC”) for the purpose of obtaining shareholder approval of the Merger and the other matters described therein;

WHEREAS, the Parties desire to amend certain terms, conditions and provisions of the Merger Agreement.

1. Defined Terms. Terms not otherwise defined in this Agreement shall have the meanings ascribed to such terms in the Original Agreement.

2. Section 4.3 of the Original Agreement is hereby amended and restated to read as follows:

Section 4.3 Governmental Authorization. Other than as set forth on Schedule 4.3 annexed hereto, no consent, approval or authorization of, or designation, declaration to or filing with, notice to, or any other action by or in respect of, any governmental Authority or other Person is required on the part of the Company with respect to the Company’s execution, delivery and performance of this Agreement and each Transaction Document to which it is a party or the consummation of the transactions contemplated hereby and thereby, except for (a) the filing of the Plan of Merger in accordance with the Cayman Companies Act, (b) the SEC declaration of effectiveness of the Proxy/Registration Statement, and (c) any consents, approvals, authorizations, designations, declarations, filings, notices or actions, the absence of which would not reasonably be expected to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole.

3. Section 4.24 of the Original Agreement is hereby amended and restated to read as follows:

Section 4.24 Affiliate Transactions. Other than as described on Schedule 4.24 annexed hereto or as described in the Registration Statement, no (a) Company Shareholder, (b) former or current director, officer, manager, indirect or direct equityholder, optionholder or member of the Company or any of its Subsidiaries or (c) any Affiliate or “associate” or any member of the “immediate family” (as such terms are respectively defined in Rules 12b-2 and 16a-1 of the Securities Exchange Act of 1934), of any Person described in the foregoing clauses (a) or (b), in each case, other than the Company or any of its Subsidiaries (each a “Related Party”), is (i) a party to any Contract or business arrangement with the Company or any of its Subsidiaries, (ii) provides any services to, or is owed any money by or owes any money to, or has any claim or right against, the Company or any of its Subsidiaries (other than, in each case, compensation for services performed by a Person as director, officer, service provider or employee of the Company or any of its Subsidiaries and amounts reimbursable for routine travel and other business expenses in the Ordinary Course of Business), or (iii) directly or indirectly owns, or otherwise has any right, title or interest in, to or under, any tangible or intangible property, asset, or right that is, has been, or is currently planned to be used by the Company or any of its Subsidiaries (the Contracts, relationships, or transactions described in clauses (i) through (iii), the “Affiliate Transactions”).

4. The Parties consent and agree that the prior Backstop Agreement as contemplated in the Original Agreement and as described in the Registration Statement, between Ever Abundant Investments Limited and Venus Acquisition Corporation dated as of June 10, 2021, shall be terminated and of no force and effect. The Parties further agree that a new Backstop Agreement shall be provided, simultaneously with execution of this Agreement, by WiMi Hologram Cloud Inc. which shall provide for a capital commitment or purchase of Venus securities in the amount of up to $15,000,000. Section 5.21 of the Original Agreement is hereby amended and restated to read as follows:

Section 5.21 Backstop Investment. Annexed hereto is a true, correct and complete duly executed Backstop Agreement(s) providing for the acquisition or purchase by WiMi Hologram Cloud Inc. as the backstop provider for up to an aggregate amount of US$15,000,000 upon the terms and conditions therein, and such Backstop Agreement is in full force and effect and has not been withdrawn or terminated, or otherwise amended or modified in any respect and no withdrawal or termination, amendment or modification in any material respect is contemplated by Purchaser. Such Backstop Agreement is a legal, valid and binding obligation of Purchaser and the backstop investor(s) thereunder, and neither the execution or delivery by any party thereto nor the performance of any party’s obligations thereunder violates any Laws. There is no other agreement, side letter, or arrangement between any of the Purchaser Parties and any investor relating to the Backstop Agreement that could affect in any material respect the obligation of the backstop investors thereunder. No Purchaser Party knows, as of the date of this Agreement, any facts or circumstances that may reasonably be expected to result in any of the conditions set forth in any Backstop Agreement not being satisfied. No event has occurred that, with or without notice, lapse of time or both, would constitute a default or breach on the part of any of the Purchaser Parties under any material term or condition of the Backstop Agreement.

11.1 Termination without Default. In the event that the Closing of the transactions contemplated hereunder has not occurred by June 30, 2022 (the “Outside Closing Date”) and no material breach of this Agreement by the party seeking to terminate this Agreement shall have occurred or have been made (as provided in Section 11.2 hereof), the Purchaser Parties or the Company, as the case may be, shall have the right, at its sole option, to terminate this Agreement without liability to the other side. Such right may be exercised by Purchaser Parties or the Company, as the case may be, by giving written notice to the other at any time after the Outside Closing Date.

7. The Parties shall cooperate in good faith to expeditiously amend the Registration Statement as soon as possible to reflect the agreements and amendments to the Original Agreement described and provided herein and to seek effectivness from the SEC.

8. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, without giving effect to the conflict of laws principles thereof.

9. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart or the earlier delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but need not individually) bear the signatures of all other parties. A determination by a court or other legal authority that any provision that is not of the essence of this Agreement is legally invalid shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good faith to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision, as alike in substance to such invalid provision as is lawful.

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IN WITNESS WHEREOF, each of the parties have hereunto caused this Agreement to be duly executed as of the date first above written.

This AMENDMENT NO. 2 TO MERGER AGREEMENT (the “Agreement”), dated as of August 2, 2022 (the “Signing Date”), by and among VIYI Algorithm Inc., a Cayman Islands exempted company (“VIYI” or the “Company”), Venus Acquisition Corporation, a Cayman Islands exempted company (“Venus” or the “Purchaser”), Venus Merger Sub Corp., a Cayman Islands exempted company and wholly-owned subsidiary of the Purchaser (the “Merger Sub”) and WiMi Hologram Cloud Inc., a Cayman Islands company and the legal and beneficial owner of a majority of the issued and outstanding voting securities of the Company (“Majority Shareholder”). The Company, Purchaser, Merger Sub and Majority Shareholder are sometimes collectively referred to as the “Parties” and individually as a “Party”.

WHEREAS, the Parties have previously entered into that certain Merger Agreement dated as of June 10, 2021 (“Original Agreement”) and Amendment No. 1 to the Original Agreement dated as of January 24, 2022 (the “First Amendment” and together with the Original Agreement, the “Merger Agreement”), whereby, among other things, VIYI will merge with Venus Merger Sub and VIYI will survive the merger as a wholly-owned subsidiary of Venus and continue its business operations (the “Merger”);

WHEREAS, the Parties now desire to amend certain terms, conditions and provisions of the Merger Agreement.

1. Defined Terms. Terms not otherwise defined in this Agreement shall have the meanings ascribed to such terms in the Merger Agreement.

2. Section 4.8 (a) of the Merger Agreement is hereby amended and restated to read as follows:

(a) Section 4.8 of the Company Disclosure Schedule includes the audited consolidated financial statements of the Company as of and for the fiscal years ended December 31, 2019, 2020 and 2021, consisting of the audited balance sheets as of such dates (the “Company Balance Sheet”), the audited income statements for the twelve (12) month periods ended on such dates, and the audited cash flow statements for the twelve (12) month periods ended on such dates (collectively, the “Financial Statements”). The Section 4.8 of the Company Disclosure Schedule also include quarterly review of the consolidated financial statements as of the period ended March 31, 2022 and June 30, 2022, respectively.

3. Section 6.5(a)(i) of the Merger Agreement is hereby amended and restated to read as follows:

(i) As promptly as reasonably practicable after the execution of this Agreement, the Purchaser Parties shall prepare, and Purchaser shall file with the SEC, a proxy statement (as amended or supplemented from time to time, the “Proxy Statement”) relating to the Purchaser Shareholders’ Meeting to approve and adopt:

(A) the Business Combination (as defined in Purchaser’s Organizational Documents), this Agreement and the other Transaction Documents, the Merger and the other Transactions (the “Business Combination Proposal”);

(B) the election of the directors of the Purchaser in accordance with Section 2.4 (the “Director Election Proposal”);

(C) approval for purposes of complying with the applicable provisions of Nasdaq Listing Rule 5635(d), the issuance by Venus of an aggregate of 39,603,961 Venus ordinary shares to the VIYI shareholders pursuant to the Merger Agreement;

(D) approval of amendments to increase the number of authorized ordinary shares to 200,000,000 ordinary shares (the “Share Increase Proposal”);

(E) approval by way of special resolution of amendments to Venus’ memorandum and articles of association to change of the name of the Purchaser to “MicroAlgo Inc.” (the “Name Change Proposal”);

(F) Approval by way of a special resolution of all other changes in connection with the amendment, restatement and replacement of Purchaser’s memorandum and articles of association including, among other things, (1) making the Purchaser’s corporate existence perpetual, and (2) removing certain provisions related to the Purchaser’s status as a blank check company that will no longer be applicable upon consummation of the Merger (the “Business Combination Proposal”); and

(G) adjournment of the Purchaser Shareholders’ Meeting, if necessary, to permit further solicitation of proxies because there are not sufficient votes to approve and adopt any of the foregoing (the “Adjournment Proposal”) (such proposals in (A), (B), (C), (D), (E), (F) and (G) collectively, the “Transaction Proposals”).

The Purchaser Parties shall use their commercially reasonable efforts to (1) cause the Proxy Statement when filed with the SEC to comply in all material respects with all Laws applicable thereto and rules and regulations promulgated by the SEC; (2) respond as promptly as reasonably practicable to and resolve all comments received from the SEC concerning the Proxy Statement; and (3) resolve all SEC comments on the Proxy Statement as promptly as practicable after such filing, and Purchaser and the Company shall take all action reasonably required (other than qualifying to do business in any jurisdiction in which it is not now so qualified, or filing a general consent to service of process) to be taken under any applicable state securities Laws in connection with the issuance of the Consideration Shares pursuant to the terms of the Merger Agreement. As promptly as practicable after all SEC comments on the Proxy Statement shall have been resolved, Purchaser shall use its reasonable best efforts to cause the Proxy Statement to be mailed to its shareholders as of the record date for the Purchaser’s Shareholders’ Meeting.

4. Section 9.2 of the Merger Agreement is hereby amended and restated to read as follows:

(b) All of the representations and warranties of the Company contained in Article IV of the Merger Agreement, disregarding all qualifications and exceptions contained herein relating to materiality or Company Material Adverse Effect, regardless of whether it involved a known risk, shall: (i) be true and correct at and as of the date of this Agreement, and (ii) be true and correct as of the Closing Date (except for the representation and warranties that speak as of a specific date prior to the Closing Date, in which case such representations and warranties need only to be true and correct as of such earlier date), in the case of (i) and (ii), other than as would not in the aggregate reasonably be expected to have a Company Material Adverse Effect.

(d) The Purchaser Parties shall have received a certificate signed by the chief executive officer of the Company to the effect set forth in clauses (a) through (c) of this Section 9.2.

(e) The requisite vote of the shareholders of the Company approving the Merger Agreement, as amended hereby, and all transactions contemplated thereby, shall have been obtained.

5. Section 11.1 of the Merger Agreement is hereby amended and restated to read as follows:

Section 11.1 Termination without Default. In the event that the Closing of the transactions contemplated hereunder has not occurred by November 11, 2022 (the “Outside Closing Date”) and no material breach of this Agreement by the party seeking to terminate this Agreement shall have occurred or have been made (as provided in Section 11.2 hereof), the Purchaser Parties or the Company, as the case may be, shall have the right, at their or its sole option, to terminate this Agreement without liability to the other party. Such right may be exercised by Purchaser Parties or the Company, as the case may be, by giving written notice to the other at any time after the Outside Closing Date.

6. Cooperation. The Parties shall cooperate in good faith to expeditiously amend the Proxy Statement as soon as possible to reflect the agreements and amendments to the Merger Agreement described and provided herein and to seek effectiveness from the SEC.

7. Effect of the Amendment. Each of the Parties represents that it has all necessary power and authority to enter into and perform the obligations of this Agreement and that there are no consents or approvals required to be obtained by such Party for such Party to enter into and perform its obligations under this Amendment that have not been obtained. This Agreement shall be deemed incorporated into, and form a part of, the Merger Agreement and have the same legal validity and effect as the Merger Agreement. Except as expressly and specifically amended hereby, all terms and provisions of the Merger Agreement are and shall remain in full force and effect, and all references to the Merger Agreement in this Amendment and in any ancillary agreements or documents delivered in connection with the Merger Agreement shall hereafter refer to the Merger Agreement as amended by this Agreement, and as it may hereafter be further amended or restated. Each reference in the Merger Agreement to “this Agreement,” “herein,” “hereof,” “hereunder” or words of similar import shall hereafter be deemed to refer to the Merger Agreement as amended hereby.

8. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, without giving effect to the conflict of laws principles thereof.

9. Miscellaneous. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart or the earlier delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but need not individually) bear the signatures of all other parties. A determination by a court or other legal authority that any provision that is not of the essence of this Agreement is legally invalid shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good faith to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision, as alike in substance to such invalid provision as is lawful.

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IN WITNESS WHEREOF, each of the parties have hereunto caused this Agreement to be duly executed as of the date first above written.

This AMENDMENT NO. 3 TO MERGER AGREEMENT (the “Agreement”), dated as of August 3, 2022 (the “Signing Date”), by and among VIYI Algorithm Inc., a Cayman Islands exempted company (“VIYI” or the “Company”), Venus Acquisition Corporation, a Cayman Islands exempted company (“Venus” or the “Purchaser”), Venus Merger Sub Corp., a Cayman Islands exempted company and wholly-owned subsidiary of the Purchaser (the “Merger Sub”) and WiMi Hologram Cloud Inc., a Cayman Islands company and the legal and beneficial owner of a majority of the issued and outstanding voting securities of the Company (“Majority Shareholder”). The Company, Purchaser, Merger Sub and Majority Shareholder are sometimes collectively referred to as the “Parties” and individually as a “Party”.

WHEREAS, the Parties have previously entered into that certain Merger Agreement dated as of June 10, 2021 (“Original Agreement”) and Amendment No. 1 to the Original Agreement dated as of January 24, 2022 (the “First Amendment” and Amendment No. 2 to the Original Agreement dated as of August 2, 2022 (the “Second Amendment”) and together with the Original Agreement, the “Merger Agreement”), whereby, among other things, VIYI will merge with Venus Merger Sub and VIYI will survive the merger as a wholly-owned subsidiary of Venus and continue its business operations (the “Merger”);

WHEREAS, the Parties now desire to amend certain terms, conditions and provisions of the Merger Agreement.

1. Defined Terms. Terms not otherwise defined in this Agreement shall have the meanings ascribed to such terms in the Merger Agreement.

2. Section 6.5(a)(i) of the Merger Agreement is hereby amended and restated to read as follows:

(B) the election of the directors of the Purchaser in accordance with Section 2.4 (the “Director Election Proposal”);

(C) approval for purposes of complying with the applicable provisions of Nasdaq Listing Rule 5635(d), the issuance by Venus an aggregate of 39,603,961 Venus ordinary shares to the VIYI shareholders pursuant to the Merger Agreement;

(D) approval of amendments to increase the number of authorized ordinary shares to 200,000,000 ordinary shares (the “Share Increase Proposal”);

3. Cooperation. The Parties shall cooperate in good faith to expeditiously amend the Proxy Statement as soon as possible to reflect the agreements and amendments to the Merger Agreement described and provided herein and to seek effectiveness from the SEC.

4. Effect of the Amendment. Each of the Parties represents that it has all necessary power and authority to enter into and perform the obligations of this Agreement and that there are no consents or approvals required to be obtained by such Party for such Party to enter into and perform its obligations under this Amendment that have not been obtained. This Agreement shall be deemed incorporated into, and form a part of, the Merger Agreement and have the same legal validity and effect as the Merger Agreement. Except as expressly and specifically amended hereby, all terms and provisions of the Merger Agreement are and shall remain in full force and effect, and all references to the Merger Agreement in this Amendment and in any ancillary agreements or documents delivered in connection with the Merger Agreement shall hereafter refer to the Merger Agreement as amended by this Agreement, and as it may hereafter be further amended or restated. Each reference in the Merger Agreement to “this Agreement,” “herein,” “hereof,” “hereunder” or words of similar import shall hereafter be deemed to refer to the Merger Agreement as amended hereby.

5. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, without giving effect to the conflict of laws principles thereof.

6. Miscellaneous. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which shall constitute one agreement. This Agreement shall become effective upon delivery to each party of an executed counterpart or the earlier delivery to each party of original, photocopied, or electronically transmitted signature pages that together (but need not individually) bear the signatures of all other parties. A determination by a court or other legal authority that any provision that is not of the essence of this Agreement is legally invalid shall not affect the validity or enforceability of any other provision hereof. The parties shall cooperate in good faith to substitute (or cause such court or other legal authority to substitute) for any provision so held to be invalid a valid provision, as alike in substance to such invalid provision as is lawful.

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IN WITNESS WHEREOF, each of the parties have hereunto caused this Agreement to be duly executed as of the date first above written.

This AMENDMENT NO. 4 TO MERGER AGREEMENT (the “Agreement”), dated as of August 10, 2022 (the “Signing Date”), by and among VIYI Algorithm Inc., a Cayman Islands exempted company (“VIYI” or the “Company”), Venus Acquisition Corporation, a Cayman Islands exempted company (“Venus” or the “Purchaser”), Venus Merger Sub Corp., a Cayman Islands exempted company and wholly-owned subsidiary of the Purchaser (the “Merger Sub”) and WiMi Hologram Cloud Inc., a Cayman Islands company and the legal and beneficial owner of a majority of the issued and outstanding voting securities of the Company (“Majority Shareholder”). The Company, Purchaser, Merger Sub and Majority Shareholder are sometimes collectively referred to as the “Parties” and individually as a “Party”.

WHEREAS, the Parties have previously entered into that certain Merger Agreement dated as of June 10, 2021 (“Original Agreement”) and Amendment No. 1 to the Original Agreement dated as of January 24, 2022 (the “First Amendment”), Amendment No. 2 to the Original Agreement dated as of August 2, 2022 (the “Second Amendment”), Amendment No. 3 to the Original Agreement dated as of August 3, 2022 (the “Third Amendment”) and together with the Original Agreement, the “Merger Agreement”), whereby, among other things, VIYI will merge with Venus Merger Sub and VIYI will survive the merger as a wholly-owned subsidiary of Venus and continue its business operations (the “Merger”);

WHEREAS, Venus has filed a Proxy Statement on Schedule 14A (“Proxy Statement”) with the Securities and Exchange Commission (“SEC”) for the purpose of obtaining shareholder approval of the Merger and the other matters described therein; and

WHEREAS, the Parties now desire to amend certain terms, conditions and provisions of the Merger Agreement.

1. Defined Terms. Terms not otherwise defined in this Agreement shall have the meanings ascribed to such terms in the Merger Agreement.

2. Section 4.8 (a) of the Merger Agreement is hereby amended and restated to read as follows:

(a) Section 4.8 of the Company Disclosure Schedule includes the audited consolidated financial statements of the Company as of and for the fiscal years ended December 31, 2019 and 2020, consisting of the audited balance sheets as of such dates (the “Company Balance Sheet”), the audited income statements for the twelve (12) month periods ended on such dates, and the audited cash flow statements for the twelve (12) month periods ended on such dates (collectively, the “Financial Statements”). The audited consolidated financial statements of the Company as of and for the fiscal year ended December 31, 2021 and the quarterly review of the consolidated financial statement of the Company as of and for the period ended March 31, 2022 have also been provided to the Purchaser Parties.

3. Section 6.5 (a)(ii), (a)(iii), (a)(iv) and (b) of the Merger Agreement are hereby amended and restated to read as follows:

connection with the Proxy Statement, or any other statement, filing, notice or application made by or on behalf of the Purchaser Parties, the Company or their respective Affiliates to any regulatory Authority (including Nasdaq) in connection with the Transactions.

(iii) Any filing of, or amendment or supplement to, the Proxy Statement will be mutually agreed upon by the Purchaser Parties and the Company. The Purchaser Parties will advise the Company, promptly after receiving notice thereof, of the time when the Proxy Statement has become effective or any supplement or amendment has been filed, of the issuance of any stop order, of the suspension of the qualification of Purchaser Ordinary Shares to be issued or issuable in connection with this Agreement for offering or sale in any jurisdiction, or of any request by the SEC for amendment of the Proxy Statement or comments thereon and responses thereto or requests by the SEC for additional information and responses thereto, and shall provide the Company a reasonable opportunity to provide comments and amendments to any such filing. The Purchaser Parties and the Company shall cooperate and mutually agree upon any response to comments of the SEC or its staff with respect to the Proxy Statement and any amendment to the Proxy Statement filed in response thereto.

(iv) If, at any time prior to the Effective Time, any information, event or circumstance relating to any Purchaser Party or their respective officers or directors, should be discovered by a Purchaser Party, which should be set forth in an amendment or a supplement to the Proxy Statement, so that neither of such documents would include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein, with respect to the Proxy Statement, in light of the circumstances under which they were made, not misleading, Purchaser shall promptly inform the Company. If, at any time prior to the Effective Time, any information, event or circumstance relating to the Company or its officers or directors, should be discovered by the Company, which should be set forth in an amendment or a supplement to the Proxy, so that neither of such documents would include any misstatement of a material fact or omit to state any material fact necessary to make the statements therein, with respect to the Proxy Statement, in light of the circumstances under which they were made, not misleading, the Company shall promptly inform the Purchaser. Thereafter, the Purchaser Parties and the Company shall promptly cooperate in the preparation and filing of an appropriate amendment or supplement to the Proxy Statement describing or correcting such information, and the Purchaser Parties shall promptly file such amendment or supplement with the SEC and, to the extent required by Law, disseminate such amendment or supplement to the Purchaser Shareholders.

(i) Prior to or as promptly as practicable after the Proxy Statement is declared effective under the Securities Act, Purchaser shall establish a depositary interest record date for, duly call, give notice of, convene and hold an extraordinary general meeting of the Purchaser Shareholders (including any adjournment or postponement thereof, the “Purchaser Shareholders’ Meeting”) to be held as promptly as reasonably practicable following the date that the Proxy Statement is declared effective under the Securities Act for the purpose of voting on the Transaction Proposals and obtaining the Purchaser Shareholders’ Approval (including any adjournment or postponement of such meeting for the purpose of soliciting additional proxies in favor of the adoption of this Agreement), providing Purchaser Shareholders with the opportunity to elect to effect a Purchaser Share Redemption and such other matter as may be mutually agreed by Purchaser and the Company. Purchaser will use its reasonable best efforts to (A) solicit from its shareholders proxies in favor of the adoption of the Transaction Proposals, including the Purchaser Shareholders’ Approval, and will take all other action necessary or advisable to obtain such proxies and Purchaser Shareholders’ Approval and (B) to obtain the vote or consent of its shareholders required by and in compliance with all applicable Law, Nasdaq rules and the Organizational Documents of Purchaser. Purchaser (X) shall consult with the Company regarding the depositary interest record date and the date of the Purchaser Shareholders’ Meeting and (Y) shall not adjourn or postpone the Purchaser Shareholders’ Meeting without the prior written consent of Company; provided, however, that Purchaser shall adjourn or postpone the Purchaser Shareholders’ Meeting (1) if, as of the time that the Purchaser Shareholders’ Meeting is originally scheduled, there are insufficient shares of Purchaser represented at such meeting (either in person or by proxy) to constitute a quorum necessary to conduct the business of the Purchaser Shareholders’ Meeting, or (2) if, as of the time that the Purchaser Shareholders’ Meeting is originally scheduled, adjournment or postponement of the Purchaser Shareholders’ Meeting is necessary to enable Purchaser to solicit additional proxies required to obtain Purchaser Shareholders’

Approval; provided further, however, that Purchaser shall adjourn or postpone on not more than three occasions and so long as the date of the Purchaser Shareholders’ Meeting is not adjourned or postponed more than an aggregate of 45 consecutive days in connection with such adjournment or postponement.

(ii) The Proxy Statement shall include a statement to the effect that the board of directors of the Purchaser Board has unanimously recommended that the Purchaser Shareholders vote in favor of the Transaction Proposals at the Purchaser Shareholders’ Meeting (such statement, the “Purchaser Board Recommendation”) and neither the Purchaser Board nor any committee thereof shall withhold, withdraw, qualify, amend or modify, or publicly propose or resolve to withhold, withdraw, qualify, amend or modify, the Purchaser Board Recommendation unless in strict observance of their common law or fiduciary duties.

4. Section 7.2 of the Merger Agreement is hereby amended and restated to read as follows:

Section 7.2 PCAOB Financials. By no later than September 15, 2022, the Company will deliver to the Purchaser Parties reviewed financial statements of the Company as of and for the six (6) month periods ended June 30, 2022, all prepared in conformity with GAAP under the standards of the Public Company Accounting Oversight Board (the “PCAOB Financials”). The PCAOB Financials shall be (i) prepared from the Books and Records of the Company; (ii) prepared on an accrual basis in accordance with GAAP; (iii) contain and reflect all necessary adjustments and accruals for a fair presentation of the Company’s financial condition as of their dates including for all warranty, maintenance, service and indemnification obligations; and (iv) contain and reflect adequate provisions for all Liabilities for all material Taxes applicable to the Company with respect to the periods then ended. The PCAOBs will be complete and accurate and fairly present in all material respects, in conformity with GAAP applied on a consistent basis in all material respects, the financial position of the Company as of the dates thereof and the results of operations of the Company for the periods reflected therein. The Company and the Majority Shareholder will provide additional financial information as reasonably requested by the Purchaser Parties for inclusion in any filings to be made by the Purchaser Parties with the SEC.

5. Section 13.1 of the Merger Agreement is hereby amended and restated to read as follows:

20th Floor, South Tower, Beijing Kerry Center, 1 Guang Hua Road, Chaoyang District, Beijing 100020

8. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, without giving effect to the conflict of laws principles thereof.

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IN WITNESS WHEREOF, each of the parties have hereunto caused this Agreement to be duly executed as of the date first above written.

(As adopted by special resolution dated [ ] 2021)
And
Amended & Restated Articles of Association
of
MicroAlgo Inc.
Adopted by special resolution passed on [ ] 2021

and unless the condition of issue expressly declares otherwise, every issue of shares (whether declared to be ordinary, preference or otherwise) is subject to this power; or

Applicable Law means, with respect to any person, all provisions of laws, statutes, ordinances, rules, regulations, permits, certificates, judgments, decisions, decrees or orders of any governmental authority applicable to such person.

Audit Committee means the audit committee of the Company formed pursuant to Article 22.8 hereof, or any successor audit committee.

Auditor means the person for the time being performing the duties of auditor of the Company.

Business Day means a day other than (a) a day on which banking institutions or trust companies are authorised or obligated by law to close in New York City (b) a Saturday or (c) a Sunday.

Clearing House means a clearing house recognised by the laws of the jurisdiction in which the Shares (or depositary receipts therefor) are listed or quoted on a stock exchange or interdealer quotation system in such jurisdiction.

Designated Stock Exchange means any national securities exchange, including the Nasdaq Stock Market LLC, the NYSE American LLC or The New York Stock Exchange LLC or any Over- the-Counter market on which the Shares are listed for trading.

Electronic has the meaning given to that term in the Electronic Transactions Act (Revised) of the Cayman Islands.

Electronic Record has the meaning given to that term in the Electronic Transactions Act (Revised) of the Cayman Islands.

Electronic Signature has the meaning given to that term in the Electronic Transactions Act (Revised) of the Cayman Islands.

Exchange Act means the United States Securities Exchange Act of 1934, as amended.

Independent Director means a director who is an independent director as defined in the rules and regulations of the Designated Stock Exchange as determined by the directors.

IPO means the initial public offering of units, consisting of Shares and warrants of the Company and rights to receive Shares of the Company.

Law means the Companies Act (Revised) of the Cayman Islands, including any statutory modification or re-enactment thereof for the time being in force.

Member means any person or persons entered on the Register of Members from time to time as the holder of a Share.

Memorandum means the memorandum of association of the Company as amended from time to time.

Officer means a person then appointed to hold an office in the Company; and the expression includes a director, alternate director or liquidator.

Ordinary Resolution means a resolution of a duly constituted general meeting of the Company passed by a simple majority of the votes cast by, or on behalf of, the Members entitled to vote thereon. The expression also includes a unanimous written resolution.

Public Share means the Shares included in the units issued in the IPO (as described in Article 2.4).

Register of Members means the register of Members maintained in accordance with the Law and includes (except where otherwise stated) any branch or duplicate register of Members.

Secretary means a person appointed to perform the duties of the secretary of the Company, including a joint, assistant or deputy secretary.

Share means an ordinary share in the share capital of the Company; and the expression:

Tax Filing Authorised Person means such person as any director shall designate from time to time, acting severally.

Treasury Shares means Shares of the Company held in treasury pursuant to the Law and Article 2.15.

Underwriter means an underwriter of the IPO from time to time, and any successor underwriter.

Without limitation to the preceding sentence, a reference to a revised Law of the Cayman Islands is taken to be a reference to the revision of that Law in force from time to time as amended from time to time.

for any Shares in the Company. That commission may be satisfied by the payment of cash or the allotment of Fully Paid or partly-paid Shares or partly in one way and partly in another.

as the directors may determine, and (in the case of defacement or wearing-out) on delivery to the Company of the old certificate.

Despite this, that person shall remain liable to the Company for all monies which, at the date of sale, were presently payable by him to the Company in respect of those Shares. That person shall also be liable to pay interest on those monies from the date of sale until payment at the rate at which interest was payable before that sale or, failing that, at the Default Rate. The directors may waive payment wholly or in part or enforce payment without any allowance for the value of the Shares at the time of sale or for any consideration received on their disposal.

but, in either case, subject to the Company retaining a like lien for all sums not presently payable as existed on the Shares before the sale.

Disposal of forfeited or surrendered Share and power to cancel forfeiture or surrender

Subject to the execution of an instrument of transfer, if necessary, the declaration shall constitute good title to the Shares.

Increasing, consolidating, converting, dividing and cancelling share capital

For that purpose, the directors may authorise some person to execute an instrument of transfer of the Shares to, or in accordance with the directions of, the purchaser. The transferee shall not be bound to see to the application of the purchase money nor shall the transferee’s title to the Shares be affected by any irregularity in, or invalidity of, the proceedings in respect of the sale.

The Company may make a payment in respect of the redemption or purchase of its own Shares in any manner authorised by the Law, including out of any combination of the following: capital, its profits and the proceeds of a fresh issue of Shares.

For the purpose of this Article, the date of redemption or purchase is the date when the redemption or purchase falls due.

Such written resolution shall be as effective as if it had been passed at a meeting of the Members entitled to vote duly convened and held.

If the directors so resolve, the Company may accept an Electronic Record of that instrument delivered in the manner specified below and otherwise satisfying the Articles about authentication of Electronic Records.

Unless otherwise determined by Ordinary Resolution, the minimum number of directors shall be one and the maximum shall be ten.

for such period and on such terms, including as to remuneration, as they think fit.

for such period and on such terms, including as to remuneration, as they think fit. In the case of an Officer, that Officer may be given any title the directors decide.

as they think fit. The powers, authorities and discretions, however, must not exceed those vested in, or exercisable, by the directors under these Articles. The directors may do so by power of attorney or any other manner they think fit.

A director who votes in favour of an action is not entitled to record his dissent to it.

be divided and considered in relation to each director separately and each of the directors concerned shall be entitled to vote and be counted in the quorum in respect of each resolution except that concerning his or her own appointment.

The Company shall cause minutes to be made in books kept for the purpose in accordance with the Law.

Except to the extent of any conflicting rights attached to Shares, the directors may fix any time and date as the record date for calling a general meeting, declaring or paying a dividend or making or issuing an allotment of Shares. The record date may be before or after the date on which the general meeting is called or a dividend, allotment or issue is declared, paid or made.

Payment of interim dividends and declaration of final dividends by directors

If the resolution fails to specify whether a dividend is final or interim, it shall be assumed to be interim.

Capitalisation of profits or of any share premium account or capital redemption reserve

The amount resolved to be capitalised must be appropriated to the Members who would have been entitled to it had it been distributed by way of dividend and in the same proportions. The benefit to each Member so entitled must be given in either or both of the following ways:

No such existing or former Secretary or Officer, however, shall be indemnified in respect of any matter arising out of his own actual fraud, wilful default or wilful neglect.

If the resolution is revoked or varied, the revocation or variation shall only become effective when its terms have been similarly notified.

Authentication of document sent by the Secretary or Officers of the Company by Electronic means

This Article applies whether the document is sent by or on behalf of the Secretary or Officer in his own right or as a representative of the Company.

and the recipient promptly gives notice to the sender setting the grounds of its objection. If the recipient invokes this Article, the sender may seek to establish the authenticity of the Electronic Record in any way the sender thinks fit.

The Company shall have the power to merge or consolidate with one or more constituent companies (as defined in the Law) upon such terms as the directors may determine and (to the extent required by the Law) with the approval of a Special Resolution.

We understand that Venus Acquisition Corporation (“Venus”) and VIYI Algorithm Inc. (“VIYI”), have entered into a Merger Agreement dated June 10, 2021 (the “Merger Agreement”), whereby Venus will acquire 100% of the outstanding equity and equity equivalents of VIYI (including options, warrants or other securities that have the right to acquire or convert into equity securities of Venus), or all of VIYI’s business will be sold to Venus in exchange for ordinary shares of Venus (the “Transaction”), where Venus will continue as the surviving publicly traded entity.

You have asked for our opinion as to whether the consideration of Merger Agreement is fair, from a financial point of view, to the independent holders of the ordinary shares of Venus.

For purposes of the opinion set forth herein, we have reviewed the Merger Agreement, certain files submitted by VIYI, including technical reports relating to VIYI’s resource properties, annual reports, management information and interim financial statements. We have reviewed also certain forward-looking information relating to VIYI, including financial projections and operating data, prepared by the management of the VIYI (the “VIYI Projections”). Additionally, we discussed the past and current operations and financial condition and the prospects of VIYI with senior executives of VIYI. In addition, we reviewed the financial terms, to the extent publicly available, of selected acquisition transactions and performed such other analyses, reviewed such other information and considered such other factors as we have deemed appropriate.

In arriving at our opinion, we have assumed and relied upon, without independent verification, the accuracy and completeness of the information that was publicly available or supplied or otherwise made available to, or discussed with, us by VIYI. With respect to the VIYI Projections we have been advised by the management of VIYI, and have assumed, that they have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the management of VIYI of the future financial performance of VIYI and other matters covered thereby. We have assumed that Merger Agreement will be consummated in accordance with the terms set forth in the Merger Agreement, without any modification, waiver or delay. In addition, we have assumed that in connection with the receipt of all the necessary approvals of the Merger Agreement, no delays, limitations, conditions or restrictions will be imposed that could have an adverse effect on the Venus or VIYI or the contemplated benefits expected to be derived in Merger Agreement. We have not performed any independent evaluation or appraisal of the assets or liabilities (fixed, contingent or otherwise) of VIYI or the Subsidiaries, nor have we been furnished with any such evaluation or appraisal. We have made no physical inspection of the property or assets of the VIYI and the Subsidiaries. In addition, we have relied, without independent verification, upon the assessment of the managements of VIYI as to the existing and future technology and products of VIYI, respectively, and the risks associated with such technology and products.

We have been engaged by the Board of Directors of Venus in connection with this transaction and will receive a fee for our services payable upon rendering of this opinion. Prior to this engagement, no material relationship existed between King Kee Appraisal and Advisory Limited (“KKG”) and its affiliates and the Venus or VIYI pursuant to which compensation was received by KKG or its affiliates. However, KKG and/or its affiliates may in the future provide valuation and other financial services to Venus or VIYI and their respective affiliates for which we or they would expect to receive compensation.

KKG provides valuation and other services to a wide range of corporations and individuals, domestically and offshore, from which conflicting interests or duties may arise.

This opinion has been approved by us in accordance with our procedure for fairness opinions. This opinion is for the information of the Board of Directors of Venus and may not be used for any other purpose without our prior written consent. This opinion does not constitute a recommendation as to how any holder of the ordinary shares of Venus should vote with respect to Merger Agreement or any other matter and does not in any manner address the prices at which the ordinary shares of Venus will trade at any time.

Our opinion is necessarily based on financial, economic, market and other conditions as in effect on, and the information made available to us as of, the date hereof. Events occurring after the date hereof may affect this opinion and the assumptions used in preparing it, and we do not assume any obligation to update, revise or reaffirm this opinion. Our opinion does not address the underlying business decision of Venus to enter into Merger Agreement, or the relative merits of Merger Agreement as compared to any strategic alternatives that may be available to Venus. Our opinion is limited to the fairness, from a financial point of view, of Merger Agreement to the independent holders of the ordinary shares of Venus. We express no opinion with respect to the fairness of the amount or nature of the compensation to any of the Venus’s officers, directors or employees, or any class of such persons. We also express no opinion regarding the consideration to be received by any other participant in the transactions contemplated by Merger Agreement.

Based upon and subject to the foregoing, and such other factors as KKG considered relevant, KKG is of the opinion that, as at the date hereof, the consideration to be paid by Venus pursuant to the Merger Agreement is fair, from a financial point of view, to the shareholders of Venus.

VENUS ACQUISITION CORPORATION
477 Madison
Avenue, 6^th Floor
New York, NY 10022
(917) 267-4568

NOTICE OF EXTRAORDINARY GENERAL MEETING OF SHAREHOLDERS
To Be Held at 10 a.m., Eastern United States time on [●], 2022
(Record Date – [●], 2022)

The undersigned hereby appoints Yanming Liu, as the proxy of the undersigned, with full power to appoint his substitute, and hereby authorizes him to represent and to vote all the ordinary shares of Venus Acquisition Corporation (“Venus”), which the undersigned is entitled to vote, as specified below on this card, at the Extraordinary General Meeting of Shareholders of Venus Acquisition Corporation, on [●], 2022, at [●] Eastern United States time (the “Extraordinary Annual Meeting”). The Extraordinary General Meeting will be a completely virtual Meeting of shareholders, which will be conducted via live webcast. You will be able to attend the Extraordinary General Meeting online, vote and submit your questions during the Extraordinary General Meeting by visiting https://www.cleartrustonline.com/venus..

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE RECOMMENDATION OF THE BOARD OF DIRECTORS FOR EACH OF THE PROPOSALS. This proxy authorizes the above designated proxy to vote in his discretion on such other business as may properly come before the meeting or any adjournments or postponements thereof to the extent authorized by Rule 14a-4(c) promulgated under the Securities Exchange Act of 1934, as amended.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR ALL”
FOR PROPOSAL 2 AND “FOR” FOR PROPOSALS 1, 3, 4, 5, 6 AND 7 SET FORTH BELOW.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK

PROPOSAL 1: To Approve the Merger Agreement, dated as of June 10, 2021, as amended, by and among Venus, Venus Acquisition Merger Subsidiary, Inc., VIYI Algorithm Inc. (“VIYI”) and WiMi Hologram Cloud Inc. (collectively referred to as the “Business Combination”). This proposal is referred to as the “Business Combination Proposal or “Proposal No. 1”.

PROPOSAL 2: To Approve the election of five (5) members to the Board of Directors of Venus. This proposal is referred to as the “Director Election Proposal” or “Proposal No. 2”.

PROPOSAL 3: To Approve for purposes of complying with the applicable provisions of Nasdaq Listing Rule 5635(d), the issuance by Venus of an aggregate of 39,603,961 Venus ordinary shares to the VIYI shareholders pursuant to the Merger Agreement. This proposal is referred to as the “Nasdaq Stock Issuance Proposal” or “Proposal No. 3”.

PROPOSAL 4: To Approve the amendments to increase the number of authorized ordinary shares to 200,000,000 ordinary shares (“Share Increase Proposal” or “Proposal 4”). For the purposes of the laws of the Cayman Islands, the full text of the resolution is as follows: “RESOLVED, as an ordinary resolution, that the authorized share capital of the Company be amended from USD50,000 divided into 50,000,000 ordinary shares of par value USD0.001 each into USD200,000 divided into 200,000,000 ordinary shares of par value USD0.001 each;”

PROPOSAL 5: To approve by way of special resolution of amendments to Venus’ memorandum and articles of association to change its name to MicroAlgo Inc. (the “Name Change Proposal” or “Proposal 5”) For the purposes of the laws of the Cayman Islands, the full text of the resolution is as follows: “RESOLVED, as a special resolution, that the Company change its name from “Venus Acquisition Corporation” to “MicroAlgo Inc.” and, subject to the provisions of the Companies Act (Revised), the change of name take effect immediately from the passing this resolution;”

PROPOSAL 6: To Approve by way of special resolution of all other changes in connection with the amendment, restatement and replacement of the Venus’ memorandum and articles of association including, among other things, (1) making New Venus’ corporate existence perpetual, and (2) removing certain provisions related to Venus’ status as a blank check company that will no longer be applicable upon consummation of the Business Combination (the “Articles Amendment Proposal” or “Proposal 6”). For the purposes of the laws of the Cayman Islands, the full text of the resolution is as follows: “RESOLVED, as a special resolution, that the Memorandum of Association and the Articles of Association, copies of which are attached to the accompanying proxy statement, be and are hereby adopted as the memorandum and articles of association of the Company in substitution for and to the exclusion of the Company’s existing Memorandum of Association and Articles of Association;”

PROPOSAL 7: To Approve to adjourn the Extraordinary General Meeting under certain circumstances, which is more fully described in the accompanying proxy statement, which we refer to as the “Adjournment Proposal” or “Proposal 7”) and, together with the Business Combination Proposal, the Director Election Proposal, the Nasdaq Stock Issuance Proposal, the Share Increase Proposal, the Name Change Proposal, the Articles Amendment Proposal and the Adjournment Proposal, collectively the “Proposals.”

Note: Please sign exactly as your names appear on this proxy. When Venus Ordinary Shares are held jointly, each holder should sign. When signing as an executor, administrator, attorney, trustee or guardian, please give full title as such. If the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as such. If the signer is a partnership, please sign in partnership name by authorized person.

Filed by the Registrant		☒
Filed by a Party other than the Registrant		☐
Check the appropriate box:

☒	Preliminary Proxy Statement
☐	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☐	Definitive Proxy Statement
☐	Definitive Additional Materials
☐	Soliciting Material under §240.14a-12

☐	No fee required.

☒	Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

	(1)	Title of each class of securities to which transaction applies: Ordinary Share, par value $0.001

	(2)	Aggregate number of securities to which transaction applies: 39,603,961

	(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): $10.10

	(4)	Proposed maximum aggregate value of transaction: $400,000,000

	(5)	Total fee paid: $37,080.00

☐	Fee paid previously with preliminary materials.

☒	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

	(1)	Amount Previously Paid: $37,080.00

	(2)	Form, Schedule or Registration Statement No.: Form S-4 (File No. 333-257518)

	(3)	Filing Party: Venus Acquisition Corporation

	(4)	Date Filed: June 29, 2021

	VIYI Cayman			Subsidiaries outside PRC			Total (Outside PRC)			Historical VIE		Subsidiaries in PRC			Consolidating
Net cash provided by operating activities		10,333,224			19,859,403			30,192,627			6,766,204		61,571,353			98,530,184
Net cash used in investing activities		—			(215,194	)		(215,194	)		—		(41,615,482	)		(41,830,676	)
Net cash used in financing activities		(3,839,567	)		(12,838,480	)		(16,678,047	)		—		(8,401,236	)		(25,079,283	)
Effect of exchange rate		(233,699	)		(1,160,451	)		(1,394,150	)		—		—			(1,394,150	)
Net increase in cash and cash equivalents		6,259,958			5,645,278			11,905,236			6,766,204		11,554,635			30,226,075
CASH AND CASH EQUIVELENTS, beginning of year		40,656,241			9,840,443			50,496,684			12,226,047		179,419,793			242,142,524
CASH AND CASH EQUIVELENTS, end of year		46,916,199			15,485,721			62,401,920			18,992,251		190,974,428			272,368,599

	Payment Due As of June 10, 2022
Traveling Expense	$	0
Consulting Expense, including special experts		0
Telephone and Delivery Expenses		0
Total	$	0

	Sincerely,

	/s/ Yanming Liu
	Yanming Liu
	Chief Executive Officer and Chairman
	Venus Acquisition Corporation
	[●], 2022

		Page
WHERE YOU CAN FIND MORE INFORMATION		iii
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		iv
QUESTIONS AND ANSWERS ABOUT THE BUSINESS COMBINATION AND THE EXTRAORDINARY GENERAL MEETING		1
DELIVERY OF DOCUMENTS TO VENUS’ SHAREHOLDERS		10
SUMMARY OF THE PROXY STATEMENT		11
SUMMARY FINANCIAL INFORMATION OF VIYI		27
SECURITIES AND DIVIDENDS		38
RISK FACTORS		39
CAPITALIZATION		86
THE BUSINESS COMBINATION PROPOSAL		87
DIRECTOR ELECTION PROPOSAL		115
NASDAQ STOCK ISSUANCE PROPOSAL		116
SHARE INCREASE PROPOSAL		117
NAME CHANGE PROPOSAL		118
ARTICLES AMENDMENT PROPOSAL		119
ADJOURNMENT PROPOSAL		120
BUSINESS OF VIYI		121
SELECTED HISTORICAL CONSOLIDATED FINANCIAL AND OPERATING DATA OF VIYI		137
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF VIYI		139
INDUSTRY OVERVIEW		161
BUSINESS OF VENUS		171
SELECTED HISTORICAL FINANCIAL INFORMATION OF VENUS		175
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF VENUS		176
UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION		183
DIRECTORS, EXECUTIVE OFFICERS, EXECUTIVE COMPENSATION AND CORPORATE GOVERNANCE OF VENUS		194
NEW VENUS’ DIRECTORS AND EXECUTIVE OFFICERS AFTER THE BUSINESS COMBINATION		198
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT PRIOR TO THE BUSINESS COMBINATION		203
SECURITY OWNERSHIP OF THE COMBINED COMPANY AFTER THE BUSINESS COMBINATION		205
REGULATIONS APPLICABLE TO VIYI		206
CERTAIN TRANSACTIONS		217
SHARES ELIGIBLE FOR FUTURE SALE		220
DESCRIPTION OF NEW VENUS’ SECURITIES		222
ENFORCEABILITY OF CIVIL LIABILITIES UNDER U.S. SECURITIES LAWS		229
LEGAL MATTERS		231
EXPERTS		231
SHAREHOLDER PROPOSALS AND OTHER MATTERS		231
DELIVERY OF DOCUMENTS TO SHAREHOLDERS		231
WHERE YOU CAN FIND ADDITIONAL INFORMATION		232
ANNEX A — MERGER AGREEMENT		A-1
ANNEX B — AMENDED AND RESTATED MEMORANDUM OF ASSOCIATION OF MICROALGO, INC. AND AMENDED AND RESTATED ARTICLES OF ASSOCIATION OF MICROALGO, INC.		B-1
ANNEX C — FAIRNESS OPINION OF KING KEE APPRAISAL AND ADVISORY LIMITED		C-1

						As Adjusted
	Historical					Assuming No		Assuming Maximum
	VIYI		Venus			Redemption		Redemption
Cash and cash equivalents	$	45,077,319	$	10,899		$	90,613,806	$	43,307,226
Marketable securities held in trust account		—	$	47,306,580			—		—
Amounts due to Parent		17,852,831		—			17,852,831		17,852,831
Ordinary shares, subject to possible redemption		—		47,306,580			—		—
Total shareholders’ equity		57,919,498		(3,012,773	)		100,959,846		53,653,266
Total capitalization	$	75,772,329	$	44,293,807		$	118,812,677	$	71,506,097

Company Name	Ticker	Description
StoneCo Ltd.	STNE	StoneCo Ltd. provides financial technology solutions. The Company offers end-to-end cloud-based technology platform to conduct electronic commerce across in-store, online, and mobile channels.

Black Knight, Inc.	BKI	Black Knight, Inc. operates as a holding company. The Company, through its subsidiaries, provides integrated technology, work flow automation, data, and analytic solutions to the mortgage and real estate industries.

Tyler Technologies, Inc.	TYL	Tyler Technologies, Inc. provides end-to-end information management solutions and services for local governments.

Company Name	Ticker	P/S multiple
StoneCo Ltd.	STNE		30.52	x
Black Knight, Inc.	BKI		8.89	x
Tyler Technologies, Inc.	TYL		15.23	x
PubMatic, Inc.	PUBM		4.37	x
Viant Technology Inc.	DSP		0.08	x
Median			8.89	x

	Year Ending December 31,
	Historical VIE															China subsidiaries
	2021E			2022E			2023E			2024E			2025E			2021E			2022E			2023E			2024E			2025E
Revenue		14,225			15,648			17,213			18,934			20,828			281,354			502,467			838,444			1,346,960			2,114,543
% Growth					10	%		10	%		10	%		10	%					79	%		67	%		61	%		57	%
Gross Profit		13,230			14,553			16,008			17,609			19,370			179,379			302,993			483,347			766,455			1,196,334
% Margin		93	%		93	%		93	%		93	%		93	%		64	%		60	%		58	%		57	%		57	%
Operating expenses		10,799			11,879			13,067			14,373			15,811			46,090			82,993			136,508			219,163			346,552
% Revenue		76	%		76	%		76	%		76	%		76	%		16	%		17	%		16	%		16	%		16	%
EBITDA		3,920			4,312			4,743			5,217			5,739			137,362			227,462			359,461			567,738			882,050
% Margin		28	%		28	%		28	%		28	%		28	%		49	%		45	%		43	%		42	%		42	%
Net Profit		3,254			3,579			3,937			4,331			4,764			112,686			180,084			285,099			451,191			701,942
% Revenue		23	%		23	%		23	%		23	%		23	%		40	%		36	%		34	%		33	%		33	%

	Year Ending December 31,
	Hong Kong (Software Development)															International (Chips)
	2021E			2022E			2023E			2024E			2025E			2021E			2022E			2023E			2024E			2025E
Revenue		35,645			37,428			39,299			41,264			43,327			130,459			136,982			143,831			151,022			158,573
% Growth					5	%		5	%		5	%		5	%					5	%		5	%		5	%		5	%
Gross Profit		23,170			24,328			25,544			26,822			28,163			36,944			37,920			45,229			44,789			40,175
% Margin		65	%		65	%		65	%		65	%		65	%		28	%		28	%		31	%		30	%		25	%
Operating expenses		4,634			5,098			5,608			6,168			6,785			12,433			20,726			22,094			21,980			18,637
% Revenue		13	%		14	%		14	%		15	%		16	%		10	%		15	%		15	%		15	%		12	%
EBITDA*		18,535			19,230			19,937			20,653			21,378			33,253			24,244			30,186			28,241			21,972
% Margin		52	%		51	%		51	%		50	%		49	%		25	%		18	%		21	%		19	%		14	%
Net Profit		15,755			16,346			16,946			17,555			18,171			20,345			14,271			19,202			18,931			17,877
% Revenue		44	%		44	%		43	%		43	%		42	%		16	%		10	%		13	%		13	%		11	%

Function	full-time employees
Research and Development		98
Business and Marketing		36
Administrative, Human Resources and Finance		29
Total		163

Segment	Reporting Unit	Fair Value Exceeds Carrying Value			Net Goodwill as of December 31, 2020		Net Goodwill as of December 31, 2021
					(in RMB thousands)
Central processing algorithm services	Central processing algorithm services unit		162	%		92,990		106,274
Intelligent chips and services	Intelligent chips and services unit		—			53,099		33,644
						146,089		139,918

		Useful Life
Customer relationship		4 years
Technology know-hows		5 years
Software copyright		5 years
Non-compete agreements		6 years

	USD		RMB		USD
Cayman		20,027,074		—		20,027,074
China – subsidiaries		—		168,122,221		25,050,245
		20,027,074		168,122,221		45,077,319

	Payments Due In
	Total RMB	Less than 1 year		1 – 2 years		3 – 5 years		Thereafter
Operating leases obligations*	2,177,548		1,609,959		425,015		142,574		—

	Six months ended June 30, 2022			Six months ended June 30, 2021			Year ended December 31, 2021			Year ended December 31, 2020
Income Statement Data:
Operating expenses	$	(258,158	)	$	(297,551	)	$	(785,096	)	$	(117,787	)
Other income (expense), net	$	60,732		$	(8,912	)	$	(27,317	)	$	—
Net loss	$	(197,426	)	$	(306,463	)	$	(812,413	)	$	(117,787	)
Basic and diluted weighted average shares outstanding, ordinary shares subject to possible redemption		4,600,000			3,532,597		$	4,070,685		$	—
Basic and diluted net income per share, ordinary shares subject to possible redemption		0.01			0.23			0.08			—
Basic and diluted weighted average shares outstanding, ordinary shares attributable to Venus Acquisition Corporation		1,450,000			1,380,387			1,415,479			1,000,000
Basic and diluted net loss per share, ordinary shares attributable to Venus Acquisition Corporation		(0.17	)		(0.80	)		(0.81	)		(0.12	)

	June 30, 2022			December 31, 2021			December 31, 2020
Balance Sheet Data:
Total assets	$	47,347,451		$	46,518,212		$	191,543
Total liabilities	$	3,053,644		$	2,026,979		$	295,205
Ordinary shares subject to possible redemption	$	47,306,580		$	46,469,183		$	—
Total shareholders’ deficit	$	(3,014,223	)	$	(1,977,950	)	$	(103,662	)

					Scenario 1 Assuming No Redemptions into Cash						Scenario 2 Assuming Maximum Redemptions into Cash
	(A) VIYI		(B) Venus		Pro Forma Adjustments				Pro Forma Balance Sheet		Pro Forma Adjustments				Pro Forma Balance Sheet
ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	45,077,319	$	10,899	$	47,306,580		(1)	$	90,613,806	$	(47,306,580	)	(3)	$	43,307,226
						(1,780,992	)	(2)
Accounts receivable, net		5,323,928		—		—				5,323,928		—				5,323,928
Inventories		316,200		—		—				316,200		—				316,200
Prepaid services fees		4,415,858		29,750		—				4,445,608		—				4,445,608
Other receivable and prepaid expense		441,955		—		—				441,955		—				441,955
Total current assets		55,575,260		40,649		45,525,588				101,141,497		(47,306,580	)			53,834,917

PROPERTY AND EQUIPMENT, NET		227,614		—		—				227,614		—				227,614

OTHER ASSETS										178,800						178,800
Prepaid expenses and deposits		190,604		222		—				190,604		—				190,604
Deferred merger costs		622,467		—		(622,467	)			—		—				—
Cost method investment		178,800		—		—				178,800		—				178,800
Intangible assets, net		3,652,676		—		—				3,652,676		—				3,652,676
Operating lease right-of-use assets		271,578		—		—				271,578		—				271,578
Goodwill		21,111,800		—		—				21,111,800		—				21,111,800
Cash and investments held in trust account		—		47,306,580		(47,306,580	)	(1)		—		—				—
Total non-current assets		26,027,925		47,306,802		(47,929,047	)			25,405,680		—				25,405,680

Total assets	$	81,830,799	$	47,347,451	$	(2,403,459	)		$	126,774,791	$	(47,306,580	)		$	79,468,211

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES
Accounts payable	$	1,610,246	$	—	$	—			$	1,610,246	$	—			$	1,610,246
Deferred revenues		2,193,348		—		—				2,193,348		—				2,193,348
Other payables and accrued liabilities		807,870		—		—				881,428		—				881,428
Due to Parent		17,852,831		—		—				17,852,831		—				17,852,831
Advance from related party		—		73,558						643,421						643,421
Banking facility		—		—		—				0		—				0
Operating lease liabilities		199,544		643,421		—				199,544		—				199,544
Notes payable-related party		—		—		—				766,665		—				766,665
Taxes payable		187,344		—		—				187,344		—				187,344
Total current liabilities		22,851,183		1,483,644		—				24,334,827		—				24,334,827

Name	Age	Position
Yanming Liu	59	Chairman and Chief Executive Officer
River Chi	40	Chief Financial Officer
Yu Chen	55	Director
Guojian Chen	29	Director
Shan Cui	49	Director

Name and Principal Position	Year	Salary ($)⁽¹⁾		All Other Compensation		Year	Salary ($)		All Other Compensation
Chengwei Yi	2020		26,444.25		—	2021		32,928.00		—
Chief Executive Officer, Chief Technical Officer

Li He⁽²⁾	2020		3,753.21		—	2021		37,632.00		—
Chief Financial Officer

Shiwen Liu⁽³⁾	2020		3066.00		—	2021		18,816.00		—
Chief Operating Officer

Wengang Kang⁽⁴⁾	2020		10,500.00		—	2021		25,200.00		—
Independent Director

Haixia Zhao⁽⁵⁾	2020		4,000.00		—	2021		24,000.00		—
Independent Director

Name and Address of Beneficial Owner⁽¹⁾	Amount and Nature of Beneficial Ownership⁽²⁾⁽³⁾		Approximate Percentage of Outstanding Shares⁽²⁾⁽³⁾
Yolanda Management Corporation⁽⁴⁾		1,375,000		22.7	%
Yanming Liu⁽⁴⁾		1,375,000		22.7	%
River Chi⁽⁵⁾		—		—
Shan Cui⁽⁵⁾		—		—
Guojian Chen⁽⁵⁾		—		—
Yu Chen⁽⁵⁾		—		—
All directors and officers as a group (5 individuals)		1,375,000		22.7	%

	New Venus ordinary shares						Voting Power
Name and Address of Beneficial Owner⁽¹⁾	Number			%			(%)
Executive Officers and Directors
Jie Zhao		19,803,961	⁽²⁾		43.3	%		43.3	%
Chengwei Yi		1,386,139	⁽³⁾		3.03	%		3.03	%
Shan Cui
Haixia Zhao
Wengang Kang
Li He
Min Shu
Shiwen Liu
All Executive Officers and Directors as a group		21,190,100			46.41	%		46.41	%

5% Or Greater Holders
WiMi Hologram Cloud Inc.		28,910,892			63.32	%		63.32	%

Unaudited Condensed Consolidated Balance Sheets		F-2
Unaudited Condensed Consolidated Statements of Operations		F-3
Unaudited Condensed Consolidated Statements of Changes in Shareholders’ Equity (Deficit)		F-4
Unaudited Condensed Consolidated Statements of Cash Flows		F-5
Notes to Unaudited Condensed Consolidated Financial Statements		F-6

Report of Independent Registered Public Accounting Firm – Friedman LLP		F-24
Consolidated Balance Sheets		F-25
Consolidated Statement of Operations		F-26
Consolidated Statements of Changes in Shareholders’ (Deficit) Equity		F-27
Consolidated Statements of Cash Flows		F-28
Notes to Consolidated Financial Statements		F-29

Unaudited Interim Condensed Consolidated Balance Sheets as of December 31, 2021 and June 30, 2022		F-46
Unaudited Interim Condensed Consolidated Statements of Income and Comprehensive Income for the six months ended June 30, 2021 and 2022		F-47
Unaudited Interim Condensed Consolidated Statements of Changes in Shareholders’ Equity for the six months ended June 30, 2021 and 2022		F-48
Unaudited Interim Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2022		F-49
Notes to Unaudited Interim Condensed Consolidated Financial Statements for the six months ended June 30, 2021 and 2022		F-50

Report of Independent Registered Public Accounting Firm		F-82
Consolidated Balance Sheets as of December 31, 2020 and 2021		F-83
Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2020 and 2021		F-84
Consolidated Statements of Changes in Shareholders’ Equity for the years ended December 31, 2020 and 2021		F-85
Consolidated Statements of Cash Flows for the years ended December 31, 2020 and 2021		F-86
Notes to Consolidated Financial Statements for the years ended December 31, 2020 and 2021		F-88

	Three months ended June 30,						Six months ended June 30,
	2022			2021			2022			2021
				(As restated)						(As restated)
Formation, general and administrative expenses	$	(90,520	)	$	(218,846	)	$	(258,158	)	$	(297,551	)

Total operating expenses		(90,520	)		(218,846	)		(258,158	)		(297,551	)

Other income (expense):
Interest income		66,917			706			70,732			1,088
Change in fair value of warrant liabilities		—			—			(10,000	)		(10,000	)
Total other income (expense), net		66,917			706			60,732			(8,912	)

Loss before income taxes		(23,603	)		(218,140	)		(197,426	)		(306,463	)

Income taxes		—			—			—			—

NET LOSS	$	(23,603	)	$	(218,140	)	$	(197,426	)	$	(306,463	)

Basic and diluted weighted average shares outstanding, ordinary shares subject to possible redemption		4,600,000			4,600,000			4,600,000			3,532,597
Basic and diluted net income (loss) per share, ordinary shares subject to possible redemption	$	0.00			(0.04	)	$	0.01		$	0.23

Basic and diluted weighted average shares outstanding, ordinary shares attributable to Venus Acquisition Corporation		1,450,000			1,450,000			1,450,000			1,380,387
Basic and diluted net income (loss) per share, ordinary shares attributable to Venus Acquisition Corporation	$	0.02		$	(0.04	)	$	(0.17	)	$	(0.80	)

	Three months ended June 30, 2022
	Ordinary shares				Additional					Total
	No. of shares		Amount		paid-in capital		Accumulated deficit			shareholders’ equity
Balance as of April 1, 2022		1,450,000	$	1,450	$	—	$	(2,463,704	)	$	(2,462,254	)
Accretion of carrying value to redemption value		—		—				(526,916	)		(526,916	)
Net loss for the period		—		—		—		(23,603	)		(23,603	)
Balance as of June 30, 2022		1,450,000	$	1,450	$	—	$	(3,014,223	)	$	(3,012,773	)

	Three months ended June 30, 2021
	Ordinary shares				Additional					Total
	No. of shares		Amount		paid-in capital		Accumulated deficit			shareholders’ equity
Balance as of April 1, 2021		1,450,000	$	1,450	$	—	$	(1,246,127	)	$	(1,244,677	)
Net loss for the period		—		—		—		(218,140	)		(218,140	)
Balance as of June 30, 2021 (As restated)		1,450,000	$	1,450	$	—	$	(1,464,267	)	$	(1,462,817	)

	Six months ended June 30, 2022
	Ordinary shares							Total
	No. of shares		Amount		Accumulated deficit			shareholders’ equity
Balance as of January 1, 2022		1,450,000	$	1,450	$	(1,979,400	)	$	(1,977,950	)
Accretion of carrying value to redemption value		—		—		(837,397	)		(837,397	)
Net loss for the period		—		—		(197,426	)		(197,426	)
Balance as of March 31, 2022		1,450,000	$	1,450	$	(3,014,223	)	$	(3,012,773	)

	Six months ended June 30, 2021
	Ordinary shares						Additional						Total
	No. of shares			Amount			paid-in capital			Accumulated deficit			shareholders’ equity
Balance as of January 1, 2021		1,150,000		$	1,150		$	23,850		$	(128,662	)	$	(103,662	)
Sale of units in initial public offering		4,600,000			4,600			39,955,400						39,960,000
Sale of units to the founder in private placement		225,000			225			1,869,775						1,870,000
Sales of representative shares		75,000			75			—			—			75
Offering costs		—			—			(2,462,767	)		—			(2,462,767	)
Initial classification of ordinary shares subject to possible redemption		(4,600,000	)		(4,600	)		(45,245,194	)		—			(45,249,794	)
Allocation of offering costs to ordinary shares subject to redemption		—			—			2,422,602			—			2,422,602
Accretion of carrying value to redemption value		—			—			(2,603,666	)		(1,029,142	)		(3,632,808	)
Net loss for the period		—			—			—			(306,463	)		(306,463	)
Balance as of March 31, 2021		1,450,000		$	1,450		$	—		$	(1,464,267	)	$	(1,462,817	)

	Level 1 —	Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation adjustments and block discounts are not being applied. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a significant degree of judgment.

	Level 2 —	Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets or liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means.

	Level 3 —	Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

	Six Months Ended June 30, 2022						Six Months Ended June 30, 2021
	Redeemable Ordinary shares			Non- Redeemable Ordinary shares			Redeemable Ordinary shares			Non- Redeemable Ordinary shares
Basic and diluted net loss per share:
Numerators:
Allocation of net loss including carrying value to redemption value	$	(768,808	)	$	(248,015	)	$	(2,832,465	)	$	(1,106,806	)
Accretion of carrying value to redemption value		837,397			—			3,632,808			—
Allocation of net income (loss)	$	50,589		$	(248,015	)	$	800,343		$	(1,106,806	)

Denominators:
Weighted-average shares outstanding		4,600,000			1,450,000			3,532,597			1,380,387
Basic and diluted net income (loss) per share	$	0.01		$	(0.17	)	$	0.23		$	(0.80	)

	Carrying Value as of June 30, 2022		Gross Unrealized Holding loss		Fair Value as of March 31, 2022
	(Unaudited)		(Unaudited)		(Unaudited)
Available-for-sale marketable securities
U.S. Treasury Securities	$	47,306,580	$	—	$	47,306,580