Company: SCAG
Filing Date: 2025-07-03
Form Type: 20-F
Source: 0001213900-25-061408
Chunk: 80

Company: Scage Future
Filing Date: 2025-07-03
Form: 20-F
Item: Item 5
Chunk 80
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 inflation in China has not materially affected our results of operations. According to the National Bureau of Statistics of China, the year-over-year percent changes in the consumer price index for 2024 remain relatively stable and slightly increased 0.2% compared to in the consumer price index for 2023. Although we have not been materially affected by inflation in the past, we may be affected if China experiences higher rates of inflation in the future.
Holding Company Structure
 
PubCo became our holding company following the completion of the Business Combination. PubCo has no material operations of its own. We conduct a substantial majority of our operations through our operating subsidiaries in China. As a result, PubCo’s ability to pay dividends depends largely upon dividends paid by our subsidiaries including our PRC subsidiaries. If our existing PRC subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. In addition, our subsidiaries in China are permitted to pay dividends to us only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, each of our subsidiaries in China are required to set aside at least 10% of its after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, our subsidiaries in China may allocate a portion of its after-tax profits based on PRC accounting standards to enterprise expansion funds and staff bonus and welfare funds at its discretion, and may allocate a portion of their after-tax profits based on PRC accounting standards to a discretionary surplus fund at their discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by SAFE. Our PRC subsidiaries did not pay dividends in the six months ended December 31, 2024, and in the fiscal years ended June 30, 2024 and 2023, and will not be able to pay dividends until they generate accumulated profits and meet the requirements for statutory reserve funds.
 
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Emerging Growth Company Status
 
As defined in Section 102(b)(1) of the JOBS Act, PubCo is as an emerging growth company (“EGC”). As such, PubCo is eligible for and intends to rely on certain exemptions and reduced reporting requirements provided by the JOBS Act, including (a) the exemption