Company: RAYA
Filing Date: 2025-07-28
Form Type: 424B5
Source: 0001213900-25-067907
Chunk: 148

Company: Erayak Power Solution Group Inc.
Filing Date: 2025-07-28
Form: 424B5
Chunk 148
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 dividends
to our shareholders and to service our indebtedness depends upon dividends received from the PRC subsidiaries. If the PRC subsidiaries
incur debt or losses, their ability to pay dividends or other distributions to us may be impaired. As a result, our ability to pay dividends
and to repay our indebtedness will be restricted. PRC laws require that dividends be paid only out of the after-tax profit of our subsidiaries
in the PRC calculated according to PRC accounting principles, which differ in many aspects from generally accepted accounting principles
in other jurisdictions. PRC laws also require enterprises established in the PRC to set aside part of their after-tax profits as statutory
reserves. These statutory reserves are not available for distribution as cash dividends. In addition, restrictive covenants in bank credit
facilities or other agreements that we or our subsidiaries may enter into in the future may also restrict the ability of our subsidiaries
to pay dividends to us. These restrictions on the availability of our funding may impact our ability to pay dividends to our shareholders
and to service our indebtedness.

To the extent cash or assets in the business is in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong due to interventions in or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets.

The transfer of funds and assets among Erayak,
its Hong Kong and PRC subsidiaries is subject to restrictions. The PRC government imposes controls on the conversion of the RMB into foreign
currencies and the remittance of currencies out of the PRC. See “Risk Factors — Governmental control of currency conversion
may affect the value of your investment.” In addition, the PRC Enterprise Income Tax Law and its implementation rules provide that
a withholding tax at a rate of 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises, unless
reduced under treaties or arrangements between the PRC central government and the governments of other countries or regions where the
non-PRC resident enterprises are tax resident. See “Risk Factors — Our PRC subsidiaries are subject to restrictions on paying
dividends or making other payments to us, which may have a material adverse effect on our ability to conduct our business.”

As of the date of this prospectus, there are no
restrictions or limitations imposed by the