Company: NCL
Filing Date: 2025-10-24
Form Type: S-1/A
Source: 0001575872-25-000638
Chunk: 37

Company: Northann Corp.
Filing Date: 2025-10-24
Form: S-1/A
Chunk 37
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 notice, could limit the legal protection available to you and us.

Our PRC subsidiaries
are subject to various PRC laws and regulations generally applicable to companies in China. Since these laws and regulations are relatively
new and the PRC legal system continues to rapidly evolve, however, the interpretations of many laws, regulations, and rules are not always
uniform and enforcement of these laws, regulations, and rules involve uncertainties.

From time to time, we
may have to resort to administrative and court proceedings to enforce our legal rights. Since PRC administrative and court authorities
have significant discretion in interpreting and implementing statutory and contractual terms, however, it may be more difficult to evaluate
the outcome of administrative and court proceedings and the level of legal protection we enjoy in the PRC legal system than in more developed
legal systems. Furthermore, the PRC legal system is based in part on government policies, internal rules, and regulations that may have
retroactive effects and may change quickly with little advance notice. As a result, we may not be aware of our violation of these policies
and rules until sometime after the violation. Such uncertainties, including uncertainties over the scope and effect of our contractual,
property (including intellectual property), and procedural rights, and any failure to respond to changes in the regulatory environment
in China could materially and adversely affect our business and impede our ability to continue our operations.

PRC regulation of parent/subsidiary loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using the proceeds of offshore offerings to make loans or additional capital contributions to the PRC subsidiaries, which could materially and adversely affect their liquidity and their ability to fund and expand their business.

We are an offshore holding company conducting
our operations in the U.S. and Hong Kong through offshore subsidiaries and in China through the PRC subsidiaries, to which we can make
loans and make additional capital contributions. Most of these loans or contributions to our PRC subsidiaries are subject to PRC regulations
and approvals or registration. For example, any loans to the PRC subsidiaries, which are treated as foreign-invested enterprises
under PRC law, are subject to PRC regulations and foreign exchange loan registrations. Furthermore, loans made by us to the PRC subsidiaries
to finance their activities cannot exceed statutory limits and must be registered with the local counterpart of SAFE, or filed with SAFE
in its information system. Pursuant to relevant PRC regulations, we may provide loans to the PRC subsidiaries up to the larger