Company: DKI
Filing Date: 2025-04-25
Form Type: DRS/A
Source: 0001641172-25-006135
Chunk: 17

Company: DarkIris Inc.
Filing Date: 2025-04-25
Form: DRS/A
Chunk 17
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 which could materially and adversely affect our liquidity and our ability to fund and expand our business ”for more information.

In the future, cash proceeds raised from overseas financing activities, including this offering, may be transferred by us to our Hong Kong subsidiaries and Turing through Quantum, as the case may be. In order for us to pay dividends to our shareholders, we may rely on payments or dividend distribution made by our subsidiaries, including Quantum, Turing, and Stellar. If any of our subsidiaries incur debt on its own behalf in the future, the instruments governing such debt may restrict their ability to pay dividends to us. While as advised by our Hong Kong counsel, Bird & Bird, current restrictions and limitations by the PRC government to transfer cash do not apply to Hong Kong entities, such restrictions and limitations by the PRC government could become applicable to Hong Kong and Hong Kong entities in the future, which may result in cash in the business in Hong Kong or Hong Kong entities being unavailable to fund 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 PRC 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 PRC 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