Company: XTKG
Filing Date: 2025-07-17
Form Type: 424B5
Source: 0001213900-25-064921
Chunk: 21

Company: X3 Holdings Co., Ltd.
Filing Date: 2025-07-17
Form: 424B5
Chunk 21
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RC accounting standards and regulations. Additionally, each of the companies in the PRC is required to set aside 10% of its
after-tax profits to fund a statutory reserve until such reserve reaches 50% of its registered capital if it distributes its
after-tax profits for the current financial year. In addition, cash transfers from our Cayman Islands holding company are subject to the applicable PRC laws and regulations on loans and direct investment. See “Item 3. Key Information — D. Risk Factors — Risk Related to Doing Business in China — We may rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements that we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business” on page 38 of our most recent annual report on Form 20-F.

In addition, the PRC government
imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of
China. We receive substantially all of our revenues in Renminbi. Under our current corporate structure, we may rely on dividend payments
from our PRC subsidiaries to fund any cash and financing requirements we may have. Under existing PRC foreign exchange regulations, payments
of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions,
can be made in foreign currencies without prior approval of SAFE by complying with certain procedural requirements. However, approval
from or registration with the appropriate governmental authorities is required where Renminbi is to be converted into foreign currency
and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, we need
to obtain SAFE approval to use cash generated from the operations of our PRC subsidiaries to pay off their respective debt in a currency
other than Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than
Renminbi. If the foreign exchange control system prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency
demands, we may not be able to pay dividends in foreign currencies to our shareholders, including holders of our Class A Ordinary Shares.
See “Item 3. Key Information — D. Risk Factors — Risk Related to Doing Business in China — PRC regulation of loans
and direct investment by offshore holding companies to PRC entities may delay or