Company: ZDAN
Filing Date: 2025-06-30
Form Type: F-1
Source: 0001683168-25-004840
Chunk: 33

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-06-30
Form: F-1
Chunk 33
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 authorities may limit or eliminate our ability to purchase foreign currencies in the future for current
account transactions. The Chinese government may continue to strengthen its capital controls, and additional restrictions and substantial
vetting processes may be instituted by SAFE for cross-border transactions falling under both the current account and the capital account.
Any existing and future restrictions on currency exchange may limit our ability to utilize revenues generated in renminbi to fund our
business activities outside of China or pay dividends in foreign currencies to holders of our securities. Foreign exchange transactions
under the capital account remain subject to limitations and require approvals from, or registration with, SAFE and other relevant Chinese
governmental authorities. This could affect our ability to obtain foreign currency through debt or equity financing for our subsidiaries.
See “Risk Factors — Risks Related to Doing Business in the PRC — We may rely on dividends and other distributions on equity paid by WFOE to fund any cash and financing requirements we may have, and any limitation on the ability of WFOE to make payments to us and any tax we are required to pay could have a material adverse effect on our ability to conduct our business.” For a detailed discussion of the Chinese legal restrictions on the payment of dividends and our ability to transfer
cash within our organization. In addition, if we are considered a PRC tax resident enterprise for tax purposes, any dividends we pay
to our overseas shareholders may be regarded as China-sourced income and, as a result, may be subject to PRC withholding tax at a rate
of up to 10.0%.

In order for us to pay dividends
to our shareholders, we will rely on payments made from the VIE to WFOE in accordance with the VIE Agreements, and the distribution of
payments from WFOE to HK Zerolimit, and finally to the Company as dividends. Certain payments from the VIE to WFOE are subject to PRC
taxes, including VAT.

Pursuant to the Arrangement
between Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income,
or the Double Tax Avoidance Arrangement, the 10% withholding tax rate may be lowered to 5% if a Hong Kong resident enterprise owns no
less than 25% of a mainland China project. However, the 5% withholding tax rate does not automatically apply and certain requirements
must be satisfied, including without limitation that (a) the Hong Kong project must be the beneficial owner of the