Company: XTKG
Filing Date: 2025-04-25
Form Type: 20-F
Source: 0001213900-25-035626
Chunk: 74

Company: X3 Holdings Co., Ltd.
Filing Date: 2025-04-25
Form: 20-F
Item: Item 3
Chunk 74
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 reducing workforce for employers.
In the event we decide to significantly change or decrease our workforce in the PRC, the Labor Contract Law could adversely affect our
ability to enact such changes in a manner that is most advantageous to our circumstances or in a timely and cost-effective manner, thus
our results of operations could be adversely affected.

If the chops of our PRC company and branches
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 our PRC subsidiary
are generally held securely by personnel designated or approved by us in accordance with our 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, we could experience disruption to our normal business operations. We may have to take corporate or
legal action, which could involve significant time and resources to resolve while distracting management from our operations.

You may experience difficulties in effecting
service of legal process, enforcing foreign judgments, or bringing actions in China against us or our management named in the prospectus
supplement based on foreign laws. It may also be difficult for you or overseas regulators to conduct investigations or collect evidence
within China.

We are a company incorporated
under the laws of the Cayman Islands, and we conduct our operations in China and our assets are located in China. In addition, most of
our senior executive officers reside within China for a significant portion of the time. As a result, it may be difficult for you to effect
service of process upon us or those persons inside mainland China. In addition, there is uncertainty as to whether the courts of the Cayman
Islands or the PRC would recognize or enforce judgments of U. S. courts against us