SCHEDULE 13D: Yujie Liu and YY Tech Inc. Acquire Significant 23.9% Stake in CIMG Inc. Through Convertible Note Conversion

Yujie Liu and YY Tech Inc. have disclosed a 23.9% beneficial ownership stake in CIMG Inc., primarily through the conversion of a convertible note and the holding of warrants.

Summary

• Yujie Liu, through her 100% ownership of YY Tech Inc., and YY Tech Inc. collectively reported beneficial ownership of 8,365,419 shares of CIMG Inc. common stock.
• This aggregate ownership represents 23.9% of CIMG Inc.'s common stock, calculated based on 30,197,418 shares outstanding as of March 24, 2025, plus 4,756,410 new shares issuable from warrants.
• The acquisition stems from a Convertible Note and Warrant Purchase Agreement dated December 12, 2024, where YY Tech Inc. used $1,855,000 in working capital to purchase a convertible promissory note and warrants.
• On March 18, 2025, the convertible note, including accrued interest, was converted into 3,609,009 shares of common stock.
• YY Tech Inc. also holds warrants to acquire an additional 4,756,410 shares of common stock.
• The purpose of the acquisition is stated as a financial investment, with the Reporting Persons potentially engaging in discussions with CIMG Inc.'s management and board regarding business, strategy, and shareholder value.

Sentiment

Score: 7

Explanation: The sentiment is positive as it announces a significant financial investment in the company, indicating investor confidence and potential future engagement to enhance shareholder value. There are no explicit negative statements or disclosures of adverse events.

Positives

• The acquisition represents a significant financial investment in CIMG Inc., indicating confidence from the Reporting Persons.
• The Reporting Persons intend to engage in discussions with CIMG Inc.'s management and board, potentially contributing to strategic direction and shareholder value enhancement.
• The investment provides CIMG Inc. with capital through the initial convertible note purchase.

Risks

• The Reporting Persons may purchase additional shares or sell some or all of their holdings, which could impact share price volatility.
• Future actions of the Reporting Persons are subject to various factors including CIMG Inc.'s financial position, strategic direction, market conditions, and general economic conditions, introducing uncertainty.

Future Outlook

The Reporting Persons intend to review their investment in CIMG Inc. on an ongoing basis and may engage in discussions with management and the board regarding the company's business, strategy, and future plans. They may also consider purchasing additional shares, selling existing holdings, or engaging in hedging transactions based on various market and company-specific factors.

Management Comments

• Yujie Liu, as 100% owner of YY Tech Inc., and YY Tech Inc. state that the purpose of their acquisitions was to make a financial investment in CIMG Inc.
• The Reporting Persons may engage in discussions with management, the board of directors, other shareholders, and relevant parties concerning the business, assets, capitalization, financial condition, operations, management, strategy, potential business combinations and strategic alternatives, and future plans of the Issuer.
• The Reporting Persons may consider, formulate, discuss, and seek to cause the Issuer to implement various plans or proposals intended to protect, preserve, or enhance stockholder value or the value of the Issuer's assets.

Industry Context

This Schedule 13D filing indicates a significant passive investment by an individual and a holding company in a publicly traded entity. Such filings are standard disclosures when an entity or individual acquires more than 5% of a company's outstanding shares, signaling a notable change in the ownership structure and potentially influencing future corporate governance or strategic direction.

Comparison to Industry Standards

• As a Schedule 13D filing, this document primarily reports a change in beneficial ownership and the intent of the Reporting Persons, rather than financial performance or operational results. Therefore, direct comparisons to industry-specific financial benchmarks or project outcomes are not applicable.
• The acquisition of a 23.9% stake is a substantial minority interest, which is a common threshold for investors seeking to influence corporate strategy or governance, aligning with typical activist or strategic investment patterns seen across various industries.

Legal Proceedings

• None of the Reporting Persons nor any director or executive officer of the Reporting Persons have been convicted in a criminal proceeding or were party to a civil proceeding resulting in a judgment enjoining future violations of securities laws in the last five years.

Stakeholder Impact

• **Shareholders:** The significant stake by Yujie Liu and YY Tech Inc. could lead to increased oversight and potential strategic changes, which may impact shareholder value. The filing of an S-1 registration statement will facilitate the resale of shares, potentially increasing liquidity.
• **Management/Board:** The Reporting Persons intend to engage in discussions with management and the board, potentially influencing strategic decisions and corporate governance.

Next Steps

• CIMG Inc. is required to file an initial Registration Statement on Form S-1 covering the resale of all registrable securities (conversion shares and warrant shares) within 30 days subsequent to the filing of its Form 10-K for the fiscal year ended September 30, 2024, or five business days after stockholder approval of the transactions, whichever is later.
• The Reporting Persons may engage in discussions with CIMG Inc.'s management, board, and other shareholders concerning the company's business, strategy, and future plans.
• The Reporting Persons may consider, formulate, and advocate for plans or proposals to protect or enhance stockholder value.
• The Reporting Persons may purchase additional shares, sell existing holdings, or engage in hedging transactions based on market conditions and CIMG Inc.'s performance.

Key Dates

Keywords

CIMG Inc., YY Tech Inc., Yujie Liu, Schedule 13D, Beneficial Ownership, Convertible Note, Warrants, Equity Investment, Shareholder Stake, SEC Filing