On 1 July 2026, NEUTECH Group announced that wholly owned subsidiary Dalian Neusoft Ruixin Health Technology Co., Ltd. (“Ruixin Health”) entered into a series of variable-interest-entity (“VIE”) agreements with Dalian Ruixin Cloud Technology Co., Ltd. (“Ruixin Cloud”) and its two individual shareholders, Dr. Wen Tao and Mr. Wang Xinghui.
The contractual framework—covering an Exclusive Management Consultancy and Business Cooperation Agreement, Exclusive Call Option Agreement, Equity Pledge Agreement, Powers of Attorney, loan agreements and spousal undertakings—grants NEUTECH: • 100 % of Ruixin Cloud’s economic benefits via service-fee arrangements; • effective control over Ruixin Cloud’s operations, management appointments and dividend policy; and • an exclusive option to purchase up to all outstanding equity in Ruixin Cloud at registered-capital par value when PRC regulations allow.
Equity Structure After Execution • NEUTECH’s on-shore subsidiary Ruixin Health owns 50 % of Ruixin Cloud directly. • The remaining 50 % (Dr. Wen 16 %, Mr. Wang 34 %) is contractually controlled through the VIE agreements. • Upon effectiveness, Ruixin Cloud will be fully consolidated into NEUTECH’s financial statements as a wholly owned subsidiary for accounting purposes.
Key Financial Terms • Ruixin Cloud will remit its entire pre-tax income (net of permissible deductions) to Ruixin Health as service fees. • Dalian Ruixin will provide interest-free shareholder loans of RMB 1.60 million to Dr. Wen and RMB 3.40 million to Mr. Wang to fund their capital contributions; the loans are repayable upon exercise of the call option.
Strategic Rationale The VIE structure enables NEUTECH to deliver “profitable internet information services” on its Citywide Smart Elderly Care Platform, a business classified as restricted to foreign investment under China’s 2024 Negative List. Ruixin Cloud already holds the requisite ICP and EDI licences (renewed January 2026).
Listing Rules and Waiver Because Dr. Wen is both a Ruixin Cloud shareholder and an executive director of NEUTECH, the transactions constitute continuing connected transactions under Chapter 14A of the Hong Kong Listing Rules. The Stock Exchange granted waivers from: 1. The three-year limit on agreement terms (Rule 14A.52); and 2. Annual monetary caps on service fees and shareholder loans (Rule 14A.53).
Internal Controls and Risk Mitigation NEUTECH will implement monthly financial reporting, annual on-site audits and board-level reviews to monitor compliance. The company acknowledges typical VIE risks, including potential regulatory changes, enforceability of contractual rights and tax adjustments.
NEUTECH stated that, should PRC regulations permit greater foreign ownership in the sector, it will partially or fully unwind the VIE structure and take direct equity in Ruixin Cloud up to the allowed threshold.