Company: ZDAN
Filing Date: 2025-06-30
Form Type: F-1
Source: 0001683168-25-004840
Chunk: 69

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-06-30
Form: F-1
Chunk 69
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 and more stringent requirements
are imposed on the VIE’s and its suppliers, the VIE may have to incur extra costs and expenses to comply with such requirements
and the VIE’s business and results of operations may be adversely affected.

Furthermore, the VIE’s
facilities are located on leased properties. Though such leases are renewable upon expiration, the VIE’s ability to renew existing
leases upon their expiration is crucial to the VIE’s production activities, operations and profitability. If the VIE is unable
to negotiate for a renewal of the relevant leases, the VIE may be forced to relocate its production bases and it may be difficult and
costly to replace or relocate the facilities and equipment on a timely basis. If the VIE fails to address the risks mentioned above,
its production will be materially and adversely affected.

If the VIE or its suppliers
experience any unanticipated disruptions, the VIE’s production will be severely disrupted, which may in turn materially and adversely
affect the VIE’s business, financial condition and results of operations.

| 38 |

The VIE may be exposed to intellectual property infringement and other claims by third parties which, if successful, could disrupt the VIE’s business and have a material adverse effect on our financial condition and results of operations.

The VIE’s success
depends, in large part, on its ability to use and develop its technology and know-how without infringing third-party intellectual property
rights. As intellectual property litigation becomes more common in PRC, the VIE faces a higher risk of being the subject of claims for
intellectual property infringement, invalidity or indemnification relating to other parties’ proprietary rights. The VIE’s
current or potential competitors, many of which have substantial resources and have made substantial investments in competing technologies,
may have or may obtain patents that will prevent, limit or interfere with the VIE’s ability to make, use or sell its products in
China. The validity and scope of claims relating to internet ecosystem technology patents involve complex scientific, legal and factual
questions and analysis and, as a result, may be highly uncertain. In addition, the defense of intellectual property suits, including
patent infringement suits, and related legal and administrative proceedings can be both costly and time consuming and may significantly
divert the efforts and resources of the VIE’s technical and management personnel. Furthermore, an adverse determination in any
such litigation or proceedings to which the VIE may become parties could cause them to:

| · | pay damage awards