(Note: This is NOT an IPO. This is a NASDAQ uplisting of Rubber Leaf’s stock from the OTC Pink Market, where the stock closed at $5.59 on Feb. 22, 2024.)

We are a Nevada-incorporated corporation, operating primarily through our wholly owned subsidiary, Rubber Leaf Sealing Products (Zhengjiang) Co., Ltd. (“RLSP”). Specializing in the production and sales of automotive rubber and plastic sealing strips, we have established ourselves as an important supplier to several major auto original equipment manufacturers, or OEMs, including eGT New Energy Automotive Co., Ltd. (“eGT”) and Volkswagen. (Incorporated in Nevada)

With significant advancements in rubber formulations and manufacturing technologies, we have strategically positioned ourselves in the dynamic automotive parts market. Operating through both direct and indirect sales models we have rapidly expanded our market presence since entering the market in 2019.

Our primary offerings consist of automotive rubber and plastic sealing strips tailored for specific models. These products boast distinctive personalized customization features, making the direct sales model the predominant approach. We directly engage with the auto OEMs or their first-tier suppliers to obtain supplier qualifications, define product specifications and models, negotiate product prices and finalize orders.

All of our executives are seasoned industry professionals with extensive experience in the automotive sector for more than 20 years. Their expertise and extensive network facilitate our market expansion for businesses. While securing approval from auto OEMs may be a time-intensive process, once established as their supplier, our continuing orders demonstrate stability spanning several years.

Our sales process is generally divided into two stages: product development and mass supply. In the initial product development stage, we initiate contact with potential customers, gaining entry into a list of qualified suppliers through a series of reviews by them. After securing projects through bidding or other methods, we will collaborate with automakers and their component suppliers to either enhance existing seal products for mass-produced models or develop new models that align with the specified functions, performance criteria and cost requirements.

Prior to finalizing batch supply agreements, which refer to supply agreements where “batch” means a specific quantity of products or materials, uniformly processed to maintain quality and identified by a unique number for efficient traceability and distribution, customers conduct thorough evaluations of our factory, production lines and management systems to verify our capacity to supply products in the required quantities and ensure consistency in product quality. This stage is time-consuming, with the improved development of seals for mass-produced auto models typically taking around six months. Simultaneous development of new models by auto OEMs and their accessory suppliers often extends over a year or more. Based on considerations such as cost efficiency and product consistency, auto OEMs generally choose one or two major suppliers for a given automotive seal product. Therefore, in the batch supply stage, we can generally obtain consistent and stable orders based on the production and sales volume of the models that incorporate our products. At this stage, our primary responsibilities include providing high-quality products in a timely manner based on customer orders, offering after-sales service, engaging in regular or irregular price negotiations and formalizing pricing contracts.

Our sales are substantially dependent on a related party, Shanghai Xinsen Import & Export Co., Ltd (“Shanghai Xinsen”). Effective on October 1, 2022, Ms. Xingxiu Hua, our Company’s Chief Executive Officer, President and Chairperson, reduced her direct ownership in Shanghai Xinsen from 90% to 15%. Concurrently, Ms. Hua stepped down as the Legal Representative and General Manager of Shanghai Xinsen pursuant to a board resolution of Shanghai Xinsen on the same date. This change in ownership was made and certified by the local government on October 11, 2022. Ms. Hua’s decision to reduce her ownership in Shanghai Xinsen was driven by her desire to focus on improving RLSP’s business strategy and market development. Despite these changes, we expect our future sales to Shanghai Xinsen will remain unaffected since RLSP has established a matured sales system with Shanghai Xinsen over the years. Furthermore, two of Shanghai Xinsen’s customers, Shanghai Hongyang and Wuhu Huichi, who indirectly purchase RLSP’s products through Shanghai Xinsen, have been using RLSP’s products on a stable and consistent basis for many years.

(Note: Rubber Leaf, Inc. filed its S-1 on Feb. 23, 2024, without disclosing the terms of its $12 million public offering – planned in connection with its NASDAQ uplisting.)

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