Company: STAK
Filing Date: 2025-11-05
Form Type: 20-F
Source: 0001493152-25-020818
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Company: STAK Inc.
Filing Date: 2025-11-05
Form: 20-F
Item: Item 3
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ITEM       KEY    
 3.    INFORMATION
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Our Company Structure
 
Our Company, STAK Inc., is a holding company with no material operations of its own. We conduct our operations through the PRC Subsidiaries in mainland China. As a result, our ability to pay dividends depends upon dividends paid by the PRC Subsidiaries. If our existing PRC Subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. In addition, our subsidiaries in mainland China are permitted to pay dividends to us only out of its retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, each of our subsidiaries in mainland China are required to set aside at least 10% of its after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of their registered capital. In addition, our subsidiaries in mainland China may allocate a portion of their after-tax profits based on PRC accounting standards to enterprise expansion funds and staff bonus and welfare funds at their discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of mainland China is subject to examination by the banks designated by SAFE. The PRC Subsidiaries didn’t distribute dividends and have made no further plans to pay dividends since such date and do not expect to do so unless and until they have generated sufficient accumulated profits and have met the requirements for statutory reserve funds.
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The following diagram illustrates our corporate structure as of the date of this annual report.
 
 

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Permissions Required from the PRC Authorities for Our Operations
 
We do not hold a special vehicle production permission to produce special vehicles as requested by the Chinese Ministry of Industry and Information Technology, so we rely on a collaborative outsourcing model to provide final products to customers. While this approach reduces the initial operational investment in large fixed assets, it also brings policy risks and business expansion bottlenecks. If the government does not allow outsourcing or if our business demand exceeds the outsourcing factory’s capacity in the future, it could severely restrict our growth and adversely affect the value of your investment. We plan to use a part of the IPO proceeds to establish a qualified factory and to obtain specialized vehicle permission, however, there is no guarantee that we can obtain