Company: IMG
Filing Date: 2025-07-21
Form Type: 10-K
Source: 0001641172-25-020300
Chunk: 26

Company: CIMG Inc.
Filing Date: 2025-07-21
Form: 10-K
Item: Item 1A
Chunk 26
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 register with local branches of SAFE in connection with their direct
establishment or indirect control of an offshore entity, for the purpose of overseas investment and financing, with such PRC residents’
legally owned assets or equity interests in domestic enterprises or offshore assets or interests, referred to in SAFE Circular No. 37
as a “special purpose vehicle.” SAFE Circular No. 37 further requires amendment to the registration in the event of any significant
changes with respect to the special purpose vehicle, such as increase or decrease of capital contributed by PRC individuals, share transfer
or exchange, merger, division or other material event. In the event that a PRC shareholder holding interests in a special purpose vehicle
fails to fulfill the required SAFE registration, the PRC subsidiaries of that special purpose vehicle may be prohibited from making profit
distributions to the offshore parent and from carrying out subsequent cross-border foreign exchange activities, and the special purpose
vehicle may be restricted in its ability to contribute additional capital into its PRC subsidiary. Further, failure to comply with the
various SAFE registration requirements described above could result in liability under PRC law for foreign exchange evasion.

These
regulations apply to our direct and indirect shareholders who are PRC residents and may apply to any offshore acquisitions or share transfers
that we make in the future if our shares are issued to PRC residents. However, in practice, different local SAFE branches may have different
views and procedures on the application and implementation of SAFE regulations, and since SAFE Circular No. 37 was relatively new, there
remains uncertainty with respect to its implementation. As of the date of this report, all PRC residents known to us that currently hold
direct or indirect interests in our company have completed the necessary registrations with SAFE as required by SAFE Circular 37. However,
we may not be informed of the identities of all the PRC residents or entities holding direct or indirect interest in our company, nor
can we compel our beneficial owners to comply with the requirements of SAFE Circular 37. However, we cannot assure you that these individuals
or any other direct or indirect shareholders or beneficial owners of our company who are PRC residents will be able to successfully complete
the registration or update the registration of their direct and indirect equity interest as required in the future. If they fail to make
or update the registration, our shareholders could be subject to fines and legal penalties, and SAFE could restrict our cross-border
investment activities and our foreign exchange activities, including restricting the PRC subsidiary’s ability to