Company: ZDAN
Filing Date: 2025-06-30
Form Type: F-1
Source: 0001683168-25-004840
Chunk: 28

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-06-30
Form: F-1
Chunk 28
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reements. The VIE Agreements were entered
into by and among WFOE, the VIE, and the VIE’s Shareholders and include the Powers of Attorney, an Equity Interest Pledge Agreement,
an Exclusive Consulting and Services Agreement, an Exclusive Option Agreement, and Spousal Consent Letters. Due to PRC legal restrictions
on foreign ownership in certain internet-related businesses we may explore and operate in the future. We control and receive the economic
benefits of the VIE’s business operations through the VIE Agreements, and we consolidate the VIE for accounting purposes only because
we met the conditions under U.S. GAAP to consolidate the VIE. Pursuant to the VIE Agreements, the VIE shall pay service fees in an amount
equivalent to all of its net income to WFOE, while WFOE has the power to direct the activities of the VIE that can significantly impact
the VIE’s economic performance, has the obligation to absorb the expected losses of the VIE, and has the right to receive substantially
all of the economic benefits of the VIE. Such contractual arrangements are designed so that the operations of the VIE are solely for
the benefit of WFOE and ultimately, the Company. As such, under the U.S. GAAP, the Company is deemed to have a controlling financial
interest in, and be the primary beneficiary of, the VIE for accounting purposes and must consolidate the VIE. We are also subject to
the risk that the PRC government could disallow the VIE structure, which would likely result in a material change in our operations and,
as a result, the value of our Ordinary Shares may depreciate significantly or become worthless. For a description of our corporate structure
and VIE contractual arrangements, see “Corporate History and Structure.” See also “Risk Factors – Risks Related to Our Corporate Structure.”

In the opinion of Global
Law Office, our PRC legal counsel, the VIE Agreements are not in violation of any prohibitive provisions of the current applicable PRC
Laws, however, the relevant PRC regulatory authorities have broad discretion in determining whether the VIE structure violates PRC laws.
Accordingly, the PRC regulatory authorities may take a view that is contrary to, or otherwise different from, the above opinion of our
PRC legal counsel. We are also subject to the risks of uncertainty about any future actions of the PRC government in this regard that
could disallow the VIE