Company: MASK
Filing Date: 2025-01-10
Form Type: 424B4
Source: 0001213900-25-002376
Chunk: 128

Company: 3 E Network Technology Group Ltd
Filing Date: 2025-01-10
Form: 424B4
Chunk 128
---
 such costs. 62 In the past, shareholders of a public company often brought securities class action suits against the company following periods of instability in the market price of that company’s securities. If we were involved in a class action suit, it could divert a significant amount of our management’s attention and other resources from our business and operations, which could harm our results of operations and require us to incur significant expenses to defend the suit. Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial conditions and results of operations. Our lack of effective internal controls over financial reporting may affect our ability to accurately report our financial results or prevent fraud which may affect the market for and price of our Class A Ordinary Shares. Prior to this offering, we were a private company with limited accounting personnel and other resources with which to address our internal controls and procedures. Upon the completion of this offering, we will become a public company in the United States subject to the Sarbanes -OxleyAct of 2002. Section 404 of the Sarbanes -OxleyAct of 2002, or Section 404, will require that we include a report from management on our internal control over financial reporting in our annual report on Form 20 -F. In addition, once we cease to be an “emerging growth company” as such term is defined in the JOBS Act, our independent registered public accounting firms must attest to and report on the effectiveness of our internal control over financial reporting. In connection with the audits of our consolidated financial statements as of June 30, 2024 and 2023, we and our independent registered public accounting firms identified material weaknesses and significant deficiencies in our internal control over financial reporting. As defined in the standards established by the PCAOB, a “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses identified are: (i) lack of competent U.S. GAAP reporting staff; (ii) lack of documented policies and controls (including IT controls and cybersecurity framework) which enable management and other personnel to understand and carry out their internal control responsibilities; and (iii) lack of