Company: SCAG
Filing Date: 2025-11-12
Form Type: 20-F
Source: 0001213900-25-109190
Chunk: 42

Company: Scage Future
Filing Date: 2025-11-12
Form: 20-F
Item: Item 3
Chunk 42
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 subsidiaries’ dividends and other distributions to us may be
subject to tightened scrutiny in the future. Any limitation on the ability of our PRC subsidiaries to pay dividends or make other distributions
to us could materially and adversely limit its ability to grow, make investments or acquisitions that could be beneficial to its business,
pay dividends, or otherwise fund and conduct its business.

Restrictions on the remittance of Renminbi
into and out of China and governmental regulation over currency conversion may limit our ability to pay dividends and other obligations
and affect the value of your investment.

Conversion of Renminbi into
foreign currencies and the remittance of funds out of China shall be made in compliance with relevant PRC laws and regulations. We and
our PRC subsidiaries receive substantially all of our revenue in Renminbi. Under our corporate structure, its income will be primarily
derived from dividend payments from its PRC subsidiaries. We may convert a portion of its revenue into other currencies to meet its foreign
currency obligations, such as payments of dividends declared in respect of Company ADSs or Ordinary Shares, if any. Shortages in the
availability of foreign currency may restrict the ability of our PRC subsidiaries to remit sufficient foreign currency to pay dividends
or other payments to us, or otherwise satisfy our foreign currency-denominated obligations.

Under existing PRC foreign
exchange regulations, payments of current account items, including profit distributions, interest payments, and trade and service-related
foreign exchange transactions, can be made in foreign currencies without the prior approval of the Administration of Foreign Exchange
of (the “ SAFE”) by complying with certain procedural requirements. However, approval from or registration or filings with
competent government authorities is required where Renminbi is to be converted into foreign currency and remitted out of China to pay
capital expenses such as the repayment of loans denominated in foreign currencies. The PRC foreign exchange regulations may evolve in
the future. We cannot assure you that new regulations will not be promulgated in the future that would have effect on the remittance
of Renminbi into or out of China. If we cannot obtain sufficient foreign currencies to satisfy our foreign currency needs, we may not
be able to pay dividends in foreign currencies to our shareholders.

China’s M& A Rules and certain
other PRC regulations establish procedures for certain acquisitions of PRC companies by foreign investors, which could make it difficult
for us to pursue growth through acquisitions in China.

The M& A Rules and some
other regulations and rules concerning mergers