Company: DKI
Filing Date: 2025-03-17
Form Type: DRS
Source: 0001493152-25-010539
Chunk: 16

Company: DarkIris Inc.
Filing Date: 2025-03-17
Form: DRS
Chunk 16
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 operations or for other use outside of Hong Kong. For more detailed information, see Risks Related to Doing Business in Jurisdictions We Operate — Regulations of currency conversion may limit our ability to transfer cash between us, our subsidiaries or investors including to utilize our net revenues effectively and affect the value of your investment.

Current PRC regulations permit Turing to pay dividends to Quantum only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. In addition, Turing is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. These reserves are not distributable as cash dividends. If Turing incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other payments to us. Any limitation on the ability of Turing to distribute dividends or other payments to Quantum could materially and adversely limit our ability to grow, make investments or acquisitions that could be beneficial to our business, pay dividends or otherwise fund and conduct our business.

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Recent statements by the Chinese government have indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investments in China based issuers. Any future action by the Chinese government expanding the categories of industries and companies whose foreign securities offerings are subject to government review could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless.

In addition, the Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC resident enterprises are incorporated. See section titled Risk Factor — We may rely on dividends and other distributions on equity paid by our Hong Kong and PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our Hong Kong and PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our businessfor more information.

We receive our revenues in Hong Kong dollars and RMB. Under our current corporate structure, our Company in the Cayman Islands will rely on dividend payments from our subsidiaries to fund any cash and financing requirements we may have. Under existing P