Company: KPEA
Filing Date: 2025-01-14
Form Type: 10-K
Source: 0001493152-25-002124
Chunk: 426

Company: Kun Peng International Ltd.
Filing Date: 2025-01-14
Form: 10-K
Item: Item 1
Chunk 426
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 Therefore, King
Eagle (China) entered into VIE Agreements with King Eagle VIE and its shareholders. Although we do not own any equity interests in King
Eagle VIE, we control and receive the economic benefits of its business operations through the VIE Agreements. The VIE Agreements enable
us to provide King Eagle VIE with consulting services on an exclusive basis, in exchange for all of its annual profits, if any. In addition,
we are able to appoint its senior executives and approve all matters requiring approval of its shareholders. The VIE Agreements are comprised
of a Consulting Service Agreement, Business Operation Agreement, Proxy Agreement, Equity Disposal Agreement, and Equity Pledge Agreement,
which are described in further detail under “Contractual Arrangements,” below.

We
believe that the VIE Agreements are not subject to any government approval under current Chinese laws and regulations. The shareholders
of King Eagle VIE were required to register with SAFE when they established offshore vehicles to hold KP International Holding; such
SAFE registration was effected on May 14, 2021. The shareholders of King Eagle VIE have registered their equity pledge arrangement as
required under the Equity Pledge Agreement with King Eagle (China). Moreover, the binding rights over the VIE’s subsidiaries in
the VIE Agreements between King Eagle (China) and King Eagle (Tianjin) are implicit and indirect and the company laws and regulations
in the PRC governing the business operations of the VIE’s subsidiaries are uncertain. The Company faces uncertainty with respect
to future actions by the PRC government that could significantly affect King Eagle VIE’s financial performance and the enforceability
of the VIE Agreements. See “Contractual Arrangements,” below.

King
Eagle VIE owns 100% of the outstanding shares of King Eagle (Huai’an), King Eagle (Beijing), Kun Zhi Jian (Huai’an), Kun
Zhi Jian (Shangdong), Kun Pin Hui (Shandong),
Chengdu Wenjiang and 95% of the outstanding shares of King Eagle (Hangzhou).

King
Eagle (Beijing) Technology Co., Ltd.

King Eagle (Beijing)
was established under the laws of the People’s Republic of China on December 1, 2022 with a registered capital of approximately
$0.7 million (RMB5 million). It is a wholly-owned subsidiary of King Eagle VIE. King Eagle (Beijing)