Company: ZDAN
Filing Date: 2025-01-10
Form Type: DRS/A
Source: 0001683168-25-000168
Chunk: 138

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-01-10
Form: DRS/A
Chunk 138
---

arrangements with us by, among other things, failing to conduct the VIE’s operations in an acceptable manner or taking other actions
that are detrimental to our interests. If we had direct ownership of the VIE, we would be able to exercise our rights as a shareholder
to effect changes in the board of directors of the VIE, which in turn could implement changes, subject to any applicable fiduciary obligations,
at the management and operational level. However, under the current contractual arrangements, we rely on the VIE and the VIE Shareholders
to perform their obligations under such contractual arrangements so that we can exercise operational control for accounting purposes.
The VIE Shareholders may not act in the best interests of our Company or may not perform their obligations under these contracts. We
are also subject to the risk that the PRC government could disallow the VIE structure, which would likely result in a material change
in our operations and, as a result, the value of our Ordinary Shares may depreciate significantly or become worthless. The VIE Agreements
have not been tested in a court of law in China as of the date of this prospectus. Such risks exist throughout the period in which we
intend to operate certain portions of our business through contractual arrangements with the VIE in accordance with the VIE Agreements.

The following is a summary
of the VIE Agreements.

Agreements that provide us and the PRC Subsidiaries with effective control over the VIE

Powers of Attorney.
Under the Powers of Attorney, dated May 24, 2023, executed by each VIE Shareholder, accepted by WFOE and acknowledged by the VIE, each
of the VIE Shareholder irrevocably authorized the WFOE’s designee, to (i) attend the shareholders’ meeting of the VIE
and execute relevant shareholders’ resolutions on behalf of the VIE Shareholder, (ii) exercise all the VIE Shareholder’s
right that the VIE Shareholder is entitled to under the PRC laws promulgated from time to time and the articles of association of the
VIE amended from time to time, including but not limited to, shareholders’ rights to vote, sell, transfer, pledge or dispose of
all or a portion of the equity interests in the VIE, (iii) appoint and elect, as the VIE Shareholder’s authorized representative,
the legal representative, chairman of the board of directors, directors, supervisors