1. ORGANIZATION The consolidated financial statements include the financial statements the Aptorum Group Limited (the Company) and its subsidiaries. The Company and its subsidiaries are hereinafter collectively referred to as the Group. The Company, formerly known as APTUS Holdings Limited and STRIKER ASIA OPPORTUNITIES FUND CORPORATION, is a company incorporated on September 13, 2010 under the laws of the Cayman Islands with limited liability. Before March 1, 2017, the Company was incorporated as an exempted open-ended investment company with limited liability in the Cayman Islands, which would own and oversee the management, operations and investments of its subsidiaries. The Company was managed by AENEAS CAPITAL LIMITED, formerly known as APTUS CAPITAL LIMITED or Guardian Capital Management Limited (the Manager), with its objective to generate long-term capital appreciation by acquiring, holding and/or investing in, by itself or through one or more of its subsidiaries or other investment vehicles, a wide range of investments, assets and/or rights, with a focus on the healthcare industry. Since March 1, 2017, the Manager enters into a new Management Agreement with the Company to manage certain investment and reinvestment. On February 21, 2017, a special resolution was passed at the directors meeting and on March 1, 2017, a resolution was passed at the shareholders meeting. According to which, the Company changed from an investment fund with management shares and non-voting participating redeemable preference shares to a holding company with operating subsidiaries (the Restructure). On March 3, 2017, an ordinary resolution passed at the extraordinary general meeting of the Company and approved by the Cayman Islands Government General Registry changed the name of the Company from STRIKER ASIA OPPORTUNITIES FUND CORPORATION to APTUS Holdings Limited. On October 13, 2017, a special resolution passed at the extraordinary general meeting of the Company, and on October 19, 2017 it was approved by the Cayman Islands Government General Registry changing the name of the Company from APTUS Holdings Limited to Aptorum Group Limited. After the Restructure as on March 1, 2017, the Company has become a Hong Kong based pharmaceutical company currently in the preclinical stage. The Company researches and develops life science and biopharmaceutical products within its wholly-owned subsidiary, Aptorum Therapeutics Limited, formerly known as APTUS Therapeutics Limited (Aptorum Therapeutics) and its indirect subsidiary companies (collectively, Aptorum Therapeutics Group). Below summarizes the list of the subsidiaries consolidated as of December 31, 2018: Name Incorporation date Ownership Place of incorporation Principle activities Aptorum Therapeutics Limited June 30, 2016 100% Cayman Islands Research and development of life science and biopharmaceutical products APTUS MANAGEMENT LIMITED May 16, 2017 100% Hong Kong Provision of management services to its holding company and fellow subsidiaries Aptus Therapeutics (Hong Kong) Limited June 30, 2016 100% Hong Kong Research and development of life science and biopharmaceutical products APTUS BIOTECHNOLOGY (MACAO) LIMITED June 6, 2016 99% Macao Inactive Videns Incorporation Limited (Formerly named Videns Biosciences Limited and VIDENS CORPORATION) March 2, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products mTOR (Hong Kong) Limited November 4, 2016 90% Hong Kong Research and development of life science and biopharmaceutical products Videns Incorporation (Hong Kong) Limited July 3, 2017 100% Hong Kong Inactive Nativus Life Sciences Limited July 7, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Scipio Life Sciences Limited July 19, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Claves Life Sciences Limited August 2, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Nativus Life Sciences (Hong Kong) Limited August 8, 2017 100% Hong Kong Inactive Scipio Life Sciences (Hong Kong) Limited August 10, 2017 100% Hong Kong Inactive Signate Life Sciences (Hong Kong) Limited August 10, 2017 100% Hong Kong Inactive Claves Life Sciences (Hong Kong) Limited August 22, 2017 100% Hong Kong Inactive Aptorum Pharmaceutical Development Limited August 28, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Aptorum Medical Limited August 28, 2017 95% Cayman Islands Provision of medical clinic services Signate Life Sciences Limited August 28, 2017 100% Cayman Islands Research and development of life science and biopharmaceutical products Acticule Life Sciences Limited June 30, 2017 80% Cayman Islands Research and development of life science and biopharmaceutical products Acticule Life Sciences (Hong Kong) Limited July 27, 2017 100% Hong Kong Inactive Forum Property Holding Limited March 6, 2018 100% Cayman Islands Inactive APTORUM INTERNATIONAL LIMITED March 26, 2018 100% United Kingdom Inactive Lanither Life Sciences Limited April 4, 2018 80% Cayman Islands Inactive Lanither Life Sciences (Hong Kong) Limited May 25, 2018 100% Hong Kong Inactive Initial public offering On December 17, 2018, the Group completed an initial public offering (the IPO or Offering) with new issuance of 761,419 ordinary shares at $15.80 for total offering size of approximately $12.0 million before deducting commissions and expenses. The net proceeds from the IPO was approximately $10.3 million, net off underwriting discount approximately $1.2 million, including warrant issued $0.2 million, and offering costs approximately $0.5 million. The ordinary shares began trading on the NASDAQ Global Market on December 17, 2018 under the ticker symbol APM. Deferred offering costs Deferred offering costs consist principally of legal, printing and registration costs in connection with the Groups IPO. Such costs are deferred until the closing of the Offering, at which time the deferred costs are offset against the offering proceeds. Deferred offering costs as of December 31, 2018 and 2017 amounted to $nil on the consolidated balance sheets. At the completion of the IPO, US$1,732,229 offering costs was charged to additional paid-in capital.